Logo Retention Rate

Logo Retention Rate measures the percentage of customers retained over a specific period, counting each customer as one unit regardless of their revenue contribution. Unlike revenue retention metrics, logo retention focuses purely on customer count and is particularly important for B2B companies where each "logo" represents a company account. It provides a simple view of customer loyalty separate from revenue expansion or contraction.

Logo Retention Rate is calculated using the formula:

Logo Retention Rate = (Customers at End of Period ÷ Customers at Start of Period) × 100

For example, if a company starts with 100 customers and ends with 95 customers, their logo retention rate is 95%.

Logo retention differs from revenue retention in key ways:

Logo Retention: Counts each customer as one unit, regardless of revenue

Revenue Retention: Accounts for revenue changes from upgrades, downgrades, and churn

Net Revenue Retention: Includes expansion revenue minus contractions and churn

Industry benchmarks for logo retention vary by business model:

• B2B SaaS: 85-95% annual logo retention is considered healthy
• Enterprise software: 90-98% annual retention for established products
• B2C SaaS: 70-90% monthly retention depending on product category
• E-commerce subscriptions: 75-90% monthly retention

Logo retention directly impacts critical business metrics:

• Customer lifetime value: Higher retention significantly increases LTV
• Growth sustainability: Better retention reduces dependency on new customer acquisition
• Unit economics: Must balance retention with customer acquisition costs
• Valuation: Investors value companies with strong customer retention

For B2B companies, logo retention is often more important than revenue retention in early stages, as it indicates product-market fit and customer satisfaction. High logo retention with low expansion can still be a strong business, while high expansion with low logo retention may indicate customer dissatisfaction masked by pricing increases.