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Metrics & Analytics

Revenue Churn

The percentage of recurring revenue lost due to cancellations and downgrades over a given period.

Definition

Revenue churn (also called MRR churn) measures the percentage of recurring revenue lost in a period. It includes both full cancellations and downgrades (contraction). Revenue churn differs from logo churn because losing a $10K customer hurts more than losing a $100 customer, even though both are one logo.

Why It Matters

Revenue churn tells you how much actual business you are losing, not just customer count. A company with low logo churn but high revenue churn is losing its best customers while retaining small ones. Email efforts to reduce churn should prioritize by revenue impact, not just count. Dunning, retention, and upgrade emails all directly affect revenue churn.

How It Works

Calculate revenue churn by dividing lost MRR (from cancellations and downgrades) by starting MRR for the period. Track gross revenue churn (losses only) and net revenue churn (losses minus expansion). Net revenue churn can be negative if expansion exceeds losses, which is the goal.

Best Practices

  • 1Track revenue churn separately from customer churn
  • 2Analyze churn by customer segment and revenue tier
  • 3Prioritize retention efforts on high-revenue accounts
  • 4Investigate unexpected revenue churn from key accounts
  • 5Use revenue data to prioritize dunning and retention emails
  • 6Build alerts for at-risk high-value accounts
  • 7Target expansion to offset revenue losses

Revenue-Based Segmentation

Segment subscribers by MRR to prioritize retention efforts. Sequenzy syncs subscription data from Stripe automatically.

Learn More

Frequently Asked Questions

Logo churn counts customers lost. Revenue churn measures dollars lost. You could have 5% logo churn but only 2% revenue churn if small customers churn more. Or you could have 2% logo churn but 5% revenue churn if big customers churn. Both matter, but revenue pays the bills.

For B2B SaaS, monthly gross revenue churn of 1-2% is typical. Enterprise-focused companies often see under 1%. High-velocity SMB products might see 3-5%. Net revenue churn should ideally be negative, meaning expansion exceeds losses.

Focus email retention efforts on high-value accounts. Build early warning systems that trigger outreach when big customers show churn signals. Invest in dunning for high-MRR customers. Proactively engage enterprise accounts before renewal. The ROI of saving a $10K account is 100x saving a $100 account.