Revenue Churn Rate

What is Revenue Churn Rate?

Measures the rate at which revenue is lost due to churn in customers or downgrades in subscription plans.

Aka MRR Churn Rate.

Why is Revenue Churn Rate important?

Helps track churn rate between high and low spenders.

Helps identify which pricing plan/ customer segment is more valuable.

How to calculate Revenue Churn Rate?

Take the revenue lost over a period (month/quarter/year).

Divide it with the revenue in the beginning of this period.

Multiply by 100.

Tips to decrease Revenue Churn Rate

Have a variable pricing scheme.

Make it easier for users with lower budgets to sign up.

Conduct frequent surveys for usability issues.

Ask users if there is something vitally important that is missing, and work on that.

Address bugs and minor issues as soon as possible.

Don’t change your pricing strategies often.