New Buyer Growth Rate

What is New Buyer Growth Rate?

This metrics calculates how fast you are adding new buyers to your marketplace. Demand is at the core of any two-sided marketplace, so tracking buyer growth rate is an indicator of success.

How to calculate New Buyer Growth Rate?

(#) of new buyers this month - (#) of new buyers last month / (#) of new buyers last month = (%) New Buyer Growth Rate

You could also look into calculating total buyer growth rate for the a period of time. Use the following formula to calculate it:

# of buyers this month - # of buyers last month / # of buyers last month = (%) Buyer Growth Rate

Pros:

An increasing New Buyer Growth Rate is an indication of a profitable business. Not to mention that attracting attract new buyers to the marketplace is likely to stimulate interest from new sellers as well.

Cons:

Tracking New Buyer Growth Rate is useful, but you should also keep an eye on how engaged your buyers are. Ultimately, if the user base is active, it’s safe to assume revenue should be increasing.