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.
- 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