This is such a cool metric and one which I truly love. How many of the visitors to my site are returning and how many are new visitors. Ideally I love to see the absolute number of returning visitors growing faster than the new visitors to the site simply because that shows the site is getting more sticky and people are enjoying it so much they are coming back of their own volition. As a site owner I feel this is a metric you should keep a close eye on.
The left image shows 2006 April returning visitor rates for my cocktail making site and the right image shows 2007 April returning visitor rates for the same site. In that time I have tripled the site traffic but grown the returning visitor rates 50% faster. This is awesome news and I am really excited to see that the site is getting better and more sticky.
The whole question is how to make that EVEN better and draw more people back to my site. Returning visitors are hugely valuable since they are free traffic and engaged. It's worth investing time and money in increasing this metric even though it's a really hard one to move.