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From the Little Stream Software blog

In the ecommerce jargon, returning customer can mean a lot of things.

Most of the time it means a customer who came back to order again. It's just another word for repeat customer.

Sometimes though, returning customer takes on a different meaning. Sometimes a customer is only labeled a returning customer for their 2nd through 4th orders. Then with their 5th order they are relabeled repeat customer.

To add to the confusion, many metrics like Repeat Purchase Rate or Shopify's Returning Customer Rate include both returning and repeat customers. That means a metric that has Returning Customer in the name isn't actually measuring returning customers.


There's no benefit of having two names just to split customers into returning/repeat buckets. If you're wanting to segment customers, call them "4th purchasers" or "repeat customers (4th)". That's much clearer than an arbitrary cutoff.

It kinda makes me wonder if the distinction was coined by a consultant looking to befuddle a client.

Eric Davis

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