Renewal rate is the percentage of customers or contract value that renew their contract at renewal time. It is measured in two distinct ways: logo renewal rate (% of customers renewing) and gross dollar renewal rate (% of ARR renewing), with the two together telling the full retention story. Renewal rate is the operational metric for customer success teams; CSMs are typically compensated against it.
The two views:
Logo renewal rate = % of customers up for renewal who renewed
A book of 100 customers with 90 renewing has 90% logo renewal rate.
Gross dollar renewal rate = % of renewing ARR retained
If $10M in ARR was up for renewal and $9M renewed (some at lower amounts due to contraction), gross dollar renewal is 90%.
Net dollar ...