How To Calculate Gross Dollar Retention in Drift | Arithmix

Calculating Gross Dollar Retention (GDR) is a crucial metric for any business that wants to understand how much revenue it retains from its existing customers. GDR is a measure of the total amount of revenue that a company retains from its customers over a specific period of time, usually a year, after accounting for any churn or lost revenue. In this article, we will explain what GDR is, why it is valuable to calculate, and how to calculate it.

What Is Gross Dollar Retention?

Gross Dollar Retention is a metric that measures the percentage of revenue that a company retains from its existing customers over a specific period of time. It takes into account the revenue that a company loses due to customer churn, cancellations, or downgrades. GDR is an important metric for companies that rely on recurring revenue, such as subscription-based businesses, because it helps them understand how much revenue they can expect to generate from their existing customer base.

GDR is calculated by dividing the total revenue generated from existing customers at the end of a specific period by the total revenue generated from those same customers at the beginning of that period. The resulting percentage is the GDR for that period. For example, if a company generated $100,000 in revenue from its existing customers at the beginning of the year and $120,000 at the end of the year, its GDR for that year would be 120%.

When Is It Valuable To Calculate Gross Dollar Retention?

Gross Dollar Retention is valuable to calculate for any business that wants to understand how much revenue it retains from its existing customers. It is particularly important for businesses that rely on recurring revenue, such as subscription-based businesses, because it helps them understand how much revenue they can expect to generate from their existing customer base. GDR is also useful for businesses that want to identify areas where they can improve customer retention and reduce churn.

By calculating GDR, businesses can identify which customers are most valuable and which ones are at risk of churning. They can then take steps to retain those valuable customers and reduce churn. For example, businesses can offer loyalty programs, personalized customer experiences, and proactive customer support to retain their most valuable customers.

In conclusion, Gross Dollar Retention is a crucial metric for any business that wants to understand how much revenue it retains from its existing customers. By calculating GDR, businesses can identify areas where they can improve customer retention and reduce churn, which can ultimately lead to increased revenue and profitability. So, if you haven't already, start calculating your GDR today!

How Do You Calculate Gross Dollar Retention in Drift

Drift itself isn’t naturally geared towards letting you calculate complex metrics like Gross Dollar Retention. As an alternative, teams typically use products like Arithmix to import data from Drift and build out dashboards.

What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that’s powerful yet easy to use. With Arithmix you can import data from systems like Drift, combine it with data from other systems, and create calculations like Gross Dollar Retention.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.

Arithmix is fully collaborative, giving your entire team access to your numbers and the ability to work together seamlessly.

Calculating Gross Dollar Retention in Arithmix

Calculating metrics like Gross Dollar Retention is simple in Arithmix. Once you've created your free account, you’ll be able to import your Drift data, and use it to create natural language formulas for metrics like Gross Dollar Retention.

Arithmix is designed to give you the power to build any calculations you want on top of your Drift data, while also being easy to use and collaborate on. You can share your dashboards with users inside and outside of your organisation, making it easy to empower your whole team.