What is Average Revenue per Churned Subscription metric in RevenueStory?

Modified on: Mon, 30 Aug, 2021 at 10:30 AM

Average Revenue lost per Churned Subscription.
Explanation of metric

Point in time indicator of Revenue lost per Churned Subscription during the period


How it's measured

Average Revenue per Churned Subscription = [(Cancellation MRR)/(No. of Churned Subscriptions)]


Note
Cancellation MRR = Total MRR of Churned Subscriptions during a period.
Cancellations within the same period of Activation are not considered.

Reading

Down: Good

Interpretation
  • Inactive or lost Customers (Churn) impact MRR and ARPU. If this number is high, make sure to keep Churn low otherwise it would impact the Average Revenue on a larger scale.
  • Example: In a given period, 15 Customers from Plan A ($10/month) and 25 Customers from Plan B ($20/month) unsubscribe.
    Average Revenue per Churned Subscription would be calculated as:
    Cancellation MRR = (15X10)+(25X20) = $650
    No. of Churned Subscriptions = (15+25) = 40
    Average Revenue per Churned Subscription = 650/40 = $16.25

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M
Monica is the author of this solution article.

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