Quick answer
Churn rate is the percentage of customers, or of recurring revenue, that you lose over a set period, usually a month. For a membership or subscription, it’s the number of people who cancelled or lapsed divided by the number you had at the start of the period. Lower churn means people stay longer and each customer is worth more.
What churn rate measures
Every subscription business leaks. People cancel because they got what they came for, because money is tight, because their card expired and nobody noticed. Churn puts a number on that leak so you can see whether it’s getting better or worse.
It matters because it compounds. A membership that loses a small share of its members every month has to win that many back just to stand still. Bring churn down and every new sign-up adds to growth instead of plugging a hole.
You’ll see the word used in other places too (staff turnover is sometimes called employee churn, and mobile networks talk about subscriber churn), but on a WordPress site it nearly always means paying members, students or subscribers who stop paying.
Customer churn vs revenue churn
There are two ways to count what you lose, and they can tell different stories.
Customer churn rate counts people. If 10 out of 200 members leave, that’s 5%, whether they were on your cheapest plan or your most expensive one.
Revenue churn counts money. It uses your monthly recurring revenue and looks at how much of it disappeared. It comes in two versions:
- Gross revenue churn: recurring revenue lost to cancellations and downgrades.
- Net revenue churn: the same losses, minus extra revenue from customers who upgraded.
If your premium members leave at a higher rate than basic ones, revenue churn will be worse than customer churn. If mostly low-paying members leave while others upgrade, it’ll be better. Track both.
How to calculate churn rate
Customer churn rate = customers lost during the period ÷ customers at the start of the period × 100
Gross revenue churn = (MRR lost to cancellations + MRR lost to downgrades) ÷ MRR at the start of the period × 100
Net revenue churn = (MRR lost to cancellations + MRR lost to downgrades − MRR gained from upgrades) ÷ MRR at the start of the period × 100
Notice that new customers aren’t in any of these. People who join during the month aren’t in your starting count, so including them would hide churn behind growth.
Worked example: an online course membership on LearnDash
Say you sell a photography course membership built on LearnDash. There are two tiers: Basic at £15 a month and Plus at £30 a month (which adds monthly critiques).
On 1 April you have 400 members: 320 on Basic and 80 on Plus. MRR is (320 × £15) + (80 × £30) = £4,800 + £2,400 = £7,200.
During April:
- 20 Basic members and 8 Plus members cancel. That’s 28 people and £300 + £240 = £540 of lost MRR.
- 5 Plus members downgrade to Basic, losing £15 each: £75.
- 10 Basic members upgrade to Plus, adding £15 each: £150.
- 45 new people join (these don’t affect churn).
| Measure | Calculation | Result |
|---|---|---|
| Customer churn rate | 28 ÷ 400 × 100 | 7.0% |
| Gross revenue churn | (540 + 75) ÷ 7,200 × 100 | 8.5% |
| Net revenue churn | (540 + 75 − 150) ÷ 7,200 × 100 | 6.5% |
Gross revenue churn is higher than customer churn because Plus members, who pay double, made up a bigger share of the cancellations than of the membership. That’s worth looking into: maybe the critiques aren’t landing, or Plus is priced too close to what people value it at. Upgrades pull net revenue churn back down, which is good news, but they don’t explain why your best-paying members are leaving.
Monthly vs annual churn
Most subscription sites measure churn monthly because that’s how often people get the chance to cancel. If you sell mainly yearly plans, an annual figure makes more sense.
Don’t convert monthly churn to annual by multiplying by 12. Each month’s churn applies to a smaller group of survivors, so the effect compounds:
Annual churn rate = 1 − (1 − monthly churn rate)^12
At 5% monthly churn, that’s 1 − 0.95^12, which is about 46% a year, not 60%.
Churn rate vs retention rate
Customer retention rate is the flip side: the share of starting customers who are still with you at the end. For the same period and the same starting group, retention rate = 100% − customer churn rate. The photography membership kept 93% of its April starters.
Use whichever framing helps. Retention sounds more positive in a team meeting; churn is easier to set a reduction target against. Churn also feeds straight into customer lifetime value: divide average monthly revenue per customer by monthly churn and you get a lifetime revenue estimate, which is why small churn improvements make such a difference.
Why members and subscribers leave
It helps to split churn into two kinds.
Voluntary churn is a decision. Common reasons on membership and course sites:
- The member got what they needed (finished the course, solved the problem) and sees no reason to stay.
- They never really started. People who don’t log in during their first week or two tend to be harder to keep.
- Price feels high compared with how often they use it.
- Content or community has gone quiet.
- Something better or cheaper came along.
Involuntary churn is an accident. A card expires, a bank declines a renewal, an email about it lands in spam, and a member who was happy to stay drops off. It can be a bigger share of churn than owners expect, and it’s usually the easiest kind to fix.
How to reduce churn rate on a membership, course or subscription site
- Fix failed payments first. Turn on automatic retries in your payment or subscription plugin, send clear card-update emails, and give a short grace period before cutting access.
- Make the first week count. A welcome email with one clear first step, a short “start here” lesson, or a quick win. Members who get value early tend to stick around.
- Offer a pause instead of only a cancel. Someone going on holiday or through a busy month may come back if they can pause, but not if they have to rejoin.
- Ask why people leave. A single optional question on the cancellation screen gives you reasons in their words. Read them every month.
- Give finished learners somewhere to go. For course memberships, a follow-on course, an advanced track or a community gives people who’ve completed the main content a reason to stay.
- Offer an annual plan. Yearly billing gives members fewer moments to reconsider. Make sure the annual price is still good value, or you’ll just move churn to renewal day.
- Check where your churners came from. Members from a heavy discount promotion often leave faster than those from a newsletter or a recommendation.
What analytics can and can’t tell you about churn
Churn itself lives in your subscription or membership plugin, which knows who cancelled and when. Your website analytics adds context: which sources bring in the members who join, and how well your sign-up page converts (see conversion rate). If you know the source, medium and campaign behind each first order, you can compare churn between groups and spend more on channels that bring members who stay. Analyzine ties orders and LearnDash enrolments to the source and campaign that earned them, inside wp-admin.
You don’t need to follow people around the web to do any of this. Measuring on your own site with cookieless tracking and joining it up with your own order records is enough to see which channels bring members worth keeping. Set a monthly reminder, calculate customer churn and gross revenue churn on the same day, and write down one thing you’ll change before next month’s numbers come in.
Frequently asked questions
What is a good churn rate?
It varies a lot by business type, price and billing period, so there’s no universal good figure. A low-cost monthly membership will usually see higher churn than an expensive annual contract. The most useful comparison is with your own past months: aim for a steady downward trend.
Does churn rate include new customers?
No. Churn is calculated against the customers you had at the start of the period, so people who join during the period aren’t counted. Including them would make churn look lower than it really is in a month with lots of sign-ups.
Is churn rate monthly or annual?
Either, but monthly is most common for subscriptions billed monthly. To turn a monthly rate into an annual one, use 1 − (1 − monthly rate)^12 rather than multiplying by 12, because churn compounds.
Can churn rate be negative?
Customer churn can’t be negative, since you can’t lose fewer than zero customers. Net revenue churn can be: if upgrades from existing customers add more MRR than cancellations and downgrades remove, the result is below zero, often called negative churn.
How do I reduce churn on a WordPress membership site?
Start with failed payments, because they’re the quickest win. Then improve the first week for new members, add a pause option and ask leavers one short question about why. Review the answers monthly and fix the most common reason first.
