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What Should Your Subscription Churn Rate Be and How to Improve It


Your subscription churn rate is one of the most critical metrics you need to keep an eye on in your subscription business. But what is it, and how can you improve it? This article will discuss everything you need to know about subscription churn, from what it is to how you can reduce it.


What is a Subscription Churn Rate?

Churn rate is the percentage of customers who cancel their subscription within a given time. For example, if you have 100 customers and ten cancel their subscriptions, your churn rate would be 10%.


How to Calculate Churn Rate

Calculating your subscription churn rate is relatively simple. All you need to do is take the number of customers who cancel their subscription in a given period and divide it by the total number of customers you had at the beginning of that period.

For example, if you had 1,000 customers at the beginning of the month and 100 canceled their subscription, your churn rate would be 10% ((100/1,000)*100).


What Should Your Subscription Churn Rate Be?

The answer to this question depends on several factors, including your industry, business model, and pricing. In general, subscription businesses should aim for a churn rate of 5% or less.

How to Improve Your Churn Rate

If your churn rate is higher than ideal, you need to take action to reduce it so you can continue to make a profit and build customer loyalty. Luckily, there are several things you can do to improve your subscription churn rate. 

Offer a free trial

Offering a free trial is an excellent way to reduce subscription churn. In addition, it allows potential customers to try out your product or service before they commit to a subscription, which can help them feel more confident about their decision.

Offer options to customize their subscription

Customers are more likely to stay subscribed if they feel they have control over their subscriptions. Offer them the ability to choose how often they receive shipments, what type of products they receive, and so on.

Provide excellent customer service

Customer service is essential for any business, but it’s especially critical for subscription businesses. Customers who are unhappy with your product or service are more likely to cancel their subscription. Make sure you’re providing the best customer service possible to reduce churn.

Offer discounts and incentives

Offering discounts and other incentives can encourage customers to stay subscribed to your service. For example, you could provide a discount for customers who pay for a year in advance or give a free month of service to customers who refer a friend.

Make it easy to cancel

It may seem counterintuitive, but making it easy for customers to cancel their subscription can help reduce subscription churn. If customers feel locked into a subscription they don’t want, they’re more likely to cancel as soon as possible. Making cancellation easy can help reduce this feeling and keep customers subscribed.



As you can see, the churn rate is an essential metric for subscription businesses. It’s important to understand what it is, how to calculate it, and what your ideal churn rate should be. You should also make sure you’re taking steps to reduce your subscription churn rate to keep your business profitable and build customer loyalty.