Discrepancies Between RetentionX and Recharge

After integrating with Recharge, RetentionX ingests data from Recharge and combines it with data from your e-commerce platform to provide you with a powerful analysis of your subscription business.

However, you may notice some mismatches between the data in RetentionX and the one presented in Recharge. But don't worry, in most of the cases it's just a matter of definition. So let's have a look at known reasons for discrepancies between RetentionX and Recharge:

Revenue Definition

When comparing two data sources, always make sure you understand the underlying definition of the metrics involved. The default definition of Gross Revenue differs between RetentionX and Recharge, which naturally leads to different results:

RetentionX
Gross Revenue = ∑ Revenue - Sales Taxes (VAT) - Shipping Revenue - Discounts

Recharge
Gross Revenue = ∑ Revenue - Discounts

Recharge includes both Sales Taxes and Shipping Revenue as part of Gross Revenue, while RetentionX does not.

Product Returns

There are two factors to consider when it comes to product returns:

1. Recharge works with Net Revenue (Gross Revenue after product returns) for its analytics, whereas RetentionX, e.g. in the MRR Development Report, operates with Gross Revenue.
   
   
2. Even if you are using the same Gross Revenue definition, the difference between RetentionX and Recharge will not add up to the amount of revenue returned. Why? RetentionX always attributes the returns back to the corresponding order date, whereas Recharge uses the date of refund.
   
   Let's take a look at an example:
   Your customer John orders product A as a subscription on May 23 and receives it a few days later. Unfortunately, John decides to return this product. In exchange, he receives a refund on June 10. Recharge reflects this return in June, whereas RetentionX does so in the month of purchase, i.e. May.

MRR vs. Total Sales

When comparing two data sources, ensure you're comparing the same metrics. In Recharge, Total Sales is a core metric, whereas RetentionX focuses on MRR. Therefore, please do not compare those metrics with each other. But what is the difference?

Total Sales
Sum of all revenue generated by subscriptions

MRR
Sum of all recurring revenues generated by subscriptions

MRR therefore takes churns into account, whereas Total Sales does not.

An example:
A customer cancelled his yearly subscription and received his last delivery in December.
Total Sales: The December order and its revenue is taken into account.
MRR: The revenue of the last order is classified as churn and therefore deducted in December. Although there was still revenue from this subscription in December, it is no longer recurring.

Failed Charges

In case of a payment error, Recharge retries the payment based on your retry intervals and settings. The settings you make for how Recharge handles orders after the retry are crucial for the resulting metrics.

If you have opted to Do nothing, the subscription and customer account will remain active. As the subscription is not cancelled, however, the order is not successfully processed, RetentionX classifies this as a Downgrade whereas Recharge does not and continues to include it in its analyses.

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