Loyalty glossary · 7. Data and analytics (31)
Repeat Purchase Rate
Repeat Purchase Rate is the proportion of members who transact again within a defined period after an initial purchase, expressed as a percentage.
Repeat purchase rate is a cohort metric, not a programme health score. It measures the share of first time buyers who return for a second transaction within a chosen window. Averages across the whole programme hide inactive members; a cohort rate exposes them.
Accrual counts points earned on every transaction, including the first. Repeat purchase rate counts only the second transaction. A member can accrue a large balance from one purchase and never return; the two metrics tell very different stories about engagement.
Activity-based qualification often uses repeat purchase rate as a threshold. A programme might require two purchases in six months to reach the next tier. That makes the rate a design tool, and an operator can move it by changing the window or the purchase definition.
An actuarial model uses repeat purchase rate to forecast how many members will become repeat buyers and how much liability that creates. The model treats the rate as an input, not an outcome. It is revised when cohorts behave differently than expected.
Take a cohort that spends 100,000 dollars in first purchases. If 40,000 dollars of that comes back within 6 months, the repeat purchase rate is 40 percent. Shorten the window to 3 months and the repeat revenue might fall to 15,000 dollars, a 15 percent rate. The difference is not a change in behaviour; it is a change in measurement.
Operators who report repeat purchase rate without stating the window are not reporting a metric; they are reporting a preference. The same cohort can look healthy over twelve months and dead over three months, and only the shorter window is honest about engagement.