How to Calculate Member Retention Rate: A Step-by-Step Guide

Member retention is a key indicator of an organization’s long-term success. Whether you're managing a professional association, an online community, or a subscription-based membership model, retention is critical for sustainability and growth. A high member retention rate means your organization delivers consistent value, fostering long-term loyalty among members.

But how do you accurately calculate member retention, and what steps can you take to improve it? In this guide, we’ll break down the member retention rate formula, provide industry benchmarks, and explore data-driven strategies to enhance retention over time.

What is Member Retention Rate?

Member retention rate measures how many members continue their membership over a given period. It is represented as a percentage and helps organizations understand how well they retain members versus how many leave.

A high retention rate signifies strong engagement, satisfaction, and long-term value, while a low retention rate may indicate issues with your membership experience or value proposition.

Why is Member Retention Rate Important?

• Cost Efficiency: Acquiring new members is 5x to 25x more expensive than retaining existing ones.
• Revenue Growth: A 5% increase in retention can boost profits by 25% to 95%.
• Stronger Community Engagement: Higher retention means more engaged, experienced members contributing to discussions, networking, and knowledge-sharing.
• Predictable Growth: High retention leads to more stable revenue and better long-term forecasting.

How to Calculate Member Retention Rate

The Member Retention Formula

The standard formula for calculating member retention rate is:

Retention Rate = (ME - MN) / MS × 100

Where:

• ME = Total members at the end of the time period
• MN = New members acquired during the time period
• MS = Total members at the start of the time period

Step-by-Step Guide to Calculating Member Retention Rate

Step #1: Choose Your Time Period

Define the period for which you want to measure retention; monthly, quarterly, or annually. Most organizations track retention annually, but shorter periods can help spot trends faster.

Step #2: Identify the Number of Members at the End of the Period (ME)

Count how many total active members you have at the end of your selected time period.

Step #3: Subtract the Number of New Members (MN)

To measure true retention, exclude newly acquired members during this period, as they haven't yet gone through a renewal cycle.

Step #4: Identify the Number of Members at the Start of the Period (MS)

This is the number of members you had at the beginning of the period before any new sign-ups or cancellations occurred.

Step #5: Calculate the Retention Rate

Use the following formula to determine your member retention rate:

(ME - MN) / MS × 100

Example Calculation:

Let's say your membership organization starts the year with 800 members. Over the course of the year, you gain 550 new members and lose 150 members.

• ME = 1200 (Total members at the end of the year)
• MN = 550 (New members acquired)
• MS = 800 (Members at the start of the year)

Now, plug these values into the formula:

(1200 - 550) / 800 × 100

= (650 / 800) × 100

= 81.25%

Your member retention rate is 81.25%, meaning most of your members continue their membership.

What’s a Good Member Retention Rate?

Retention rates vary by industry, but most successful membership organizations strive for retention rates above 75%.

Industry Benchmarks

• Professional Associations: 85-95%
• Subscription Services: 75-85%
• Online Communities: 65-80%
• Gyms & Fitness Clubs: 60-70%
• Nonprofits & Cause-Based Memberships: 70-90%

While 100% retention is unrealistic, steady improvements in retention rates increase lifetime value and member engagement.

How to Improve Member Retention

1. Strengthen Member Onboarding

• Guide new members through a structured onboarding process.
• Send a welcome email sequence with key resources and engagement opportunities.
• Assign a community ambassador to help new members integrate.

2. Provide Ongoing Value & Engagement

• Offer exclusive member-only content (webinars, reports, networking events).
• Implement a community discussion forum where members can connect and ask questions.
• Personalize content based on member interests and activity.

3. Gather & Act on Member Feedback

• Conduct regular surveys to assess satisfaction.
• Monitor drop-off points to understand why members leave.
• Offer exit surveys to improve future member experience.

4. Foster a Strong Sense of Community

• Encourage peer-to-peer interaction through mentorship programs or networking groups.
• Recognize active members through spotlights, badges, or leadership roles.
• Host virtual and in-person events to strengthen relationships.

5. Make Renewal & Membership Benefits Clear

• Automate renewal reminders via email and SMS.
• Offer loyalty incentives like discounts or VIP access.
• Provide an easy, one-click renewal process to reduce friction.

Conclusion

Calculating and improving member retention rate is essential for long-term success. By tracking retention over time, organizations can identify engagement trends, refine membership offerings, and build stronger, more loyal communities.

A high retention rate means your members find lasting value in your organization—so invest in personalized engagement, ongoing value delivery, and a seamless renewal experience.

Want to improve your retention strategy? Explore how Bevy helps organizations build thriving, engaged communities with scalable event and member engagement solutions.