Churn rate
Churn rate is the share of paying subscribers who cancel or lapse in a period, usually a month. It sets how long a customer pays and therefore how much acquisition a subscription business can afford.
Churn is the other half of every subscription CAC decision. A customer who pays $30 a month and stays for ten months is worth a very different acquisition cost from one who leaves after two, and the ad account sees neither.
A worked example, as arithmetic. With a steady 5% monthly churn, the average subscriber pays for about twenty months, since expected lifetime is roughly one divided by the churn rate. At 10% it is about ten months. Doubling churn halves the lifetime value, and it halves the acquisition cost the business can carry.
Measure churn by acquisition channel and by cohort, not only as a company average. Channels that buy customers cheaply sometimes buy them flaky, and a channel with higher CAC can be the better investment when its customers stay. Payback and lifetime value by source are what should move budget.
Knowing what Churn rate means isn’t the edge.
Knowing what it’s doing to live accounts right now is. Operator notes from $200M+ in managed spend — sent when we find something worth your time.
Want to know what yours is?
The free audit reads your actual account and computes the numbers behind every one of these definitions — no generic benchmarks.
Run the free audit