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The percentage of recurring revenue retained from existing customers, excluding expansion revenue.
Explanation of metric
A chart illustrates the percentage of recurring revenue retained during the selected period from active subscriptions in the previous period, excluding any expansion effects.
How it's measured
Gross Revenue Retention = Percentage of MRR in the selected period of subscriptions active in the previous period and their MRR in the previous period, without considering any expansion that has happened during the period.
Note:
Any subscription with the previous period MRR as 0 can be omitted.
Reading
An upward trend indicates growth in committed revenue.
Interpretation
Gross Revenue Retention (GRR) is a critical financial metric that measures a company's ability to retain customers and sustain revenue, excluding expansion revenue from upsells, cross-sells, or upgrades. This metric is particularly important for subscription-based businesses and those in the Software-as-a-Service (SaaS) sector, providing valuable insights into customer retention.
Example
In a given period,
Total MRR at the beginning of the period: $5,000
Total MRR at the end of the period: $6,000
Gross Revenue Retention considers only the retained MRR without including any expansion. Therefore, use the minimum MRR at the beginning and end of the period.
Gross Revenue Retention Rate = Minimum(Total MRR at the beginning of the period, Total MRR at the end of the period)/MRR at the beginning of the period = 5000/5000 = 1%
The percentage of recurring revenue retained from existing customers, including expansion revenue and accounting for churn.
Explanation of metric
A chart represents the percentage of recurring revenue retained during the selected period from subscriptions active in the previous period.
How it's measured
Net Revenue Retention = (Total MRR at the end of the period / Total MRR at the beginning of the period) × 100
Note:
Omit any subscription with a previous period MRR of 0.
Reading
An upward trend indicates growth in committed revenue.
Interpretation
This metric encompasses the overall revenue, incorporating expansion revenue while deducting revenue losses caused by churn, which includes contract expirations, cancellations, or downgrades. It provides a comprehensive view of a company's ability to retain and grow revenue from its existing customer base.
Example
Summary of Monthly Recurring Revenue movements over time.
Explanation of metric
This table breaks down the MRR components during the period.
How it's measured
Closing MRR of the period = [(Opening MRR) + (New MRR) + (Currency Change MRR) + (Upgrade MRR) + (Free to Paid MRR) + (Reactivation MRR) +Resume MRR -(Cancellation MRR) - (Downgrade MRR) - (Active to Trial MRR) - (Paused MRR) +/- (Exchange rate fluctuations during the period)]
Reading
Interpretation
This report provides a granular breakdown of MRR, highlighting net and gross expansion and contraction from existing customers over a period.
Example
In a given period,
Opening MRR: $120,000
New MRR: $23,000
Currency Change MRR: $0
Upgrade MRR: $22,000
Free to Paid MRR: $1,200
Resume MRR: $800
Reactivation MRR: $5,678
Cancellation MRR: $3,656
Downgrade MRR: $1,500
Active to Trial MRR: $756
Paused MRR: $550
Closing MRR of the period = (120,000 + 23,000 + 0 + 22,000 + 1,200 + 5,678 + 800) - (3,656 + 1,500 + 756 + 550) = 172,678 - 6,462 = $166,216
Summary of Annual Recurring Revenue movements over time.
Explanation of metric
This table breaks down the ARR components during the period.
How it's measured
Closing ARR of the period = [(Opening ARR) + (New ARR) + (Currency Change ARR) + (Upgrade ARR) + (Free to Paid ARR) + (Pause to Paid ARR) + (Reactivation ARR) - (Cancellation ARR) - (Downgrade ARR) - (Active to Trial ARR) - (Paused ARR) +/- (Exchange rate fluctuations during the period)]
Reading
A downward trend suggests a decrease, warranting further analysis.
Interpretation
This report provides a granular breakdown of ARR, highlighting the net and gross expansion and contraction of existing customers over a period.
Example
In a given period:
Opening ARR: $120,000
New ARR: $23,000
Currency Change ARR: $0
Upgrade ARR: $22,000
Free to Paid ARR: $1,200
Pause to Paid ARR: $800
Reactivation ARR: $5,678
Cancellation ARR: $3,656
Downgrade ARR: $1,500
Active to Trial ARR: $756
Paused ARR: $550
Calculation: Closing ARR of the period = (120,000 + 23,000 + 0 + 22,000 + 1,200 + 800 + 5,678) - (3,656 + 1,500 + 756 + 550) = 172,678 - 6,462 = $166,216
Total Monthly Recurring Revenue earned from subscriptions.
Explanation of metric
A trend line depicts the total predictable Monthly Recurring Revenue (MRR) earned from customers. This metric provides a point-in-time indicator, representing the Total MRR of subscriptions in the current period. It also compares the Total MRR for the previous period and the percentage change across both periods.
How it's measured
Total MRR = Total MRR of subscriptions during the period.
Note:
Included in Total MRR:
Included in Total MRR (if configured):
Excluded from Total MRR:
Reading
An upward trend indicates growth in committed revenue.
Interpretation
Total MRR is a key performance indicator (KPI) that reflects a business's health. Investors often consider this metric before making investment decisions. Total MRR is the north star metric that should increase to ensure sustainable growth.
Example
In a given period:
Calculation:
Total Monthly Recurring Revenue earned from subscriptions.
Explanation of metric
Total Monthly Recurring Revenue (MRR) by Price Variant measures the recurring revenue generated from active subscriptions grouped by specific price variants.
How it's measured
Total MRR by Price Variant = Total MRR of subscriptions during the period per price variant.
Reading
This metric indicates the contribution to MRR from specific price variants, with a higher value suggesting higher adoption or retention at those price points.
Interpretation
Total MRR by Price Variant helps businesses identify the most effective pricing strategies driving recurring revenue. By analyzing this metric, stakeholders can make informed decisions about pricing adjustments, promotions, and product bundling. A steady upward trend signifies strong adoption of specific price variants, while a decline may indicate the need for pricing revisions or marketing interventions.
Example
If your business offers three price variants: Basic-Standard ($50), Basic-Pro ($100), and Basic-Premium ($150). At the end of the month, the active subscriptions for each variant contribute the following MRR:
Total MRR by Price Variant:
This breakdown allows the business to compare the performance of different price variants and adjust its pricing strategy accordingly.
Measures the total monthly recurring revenue (MRR) earned from active subscriptions, segmented by country.
Explanation of metric
This metric represents the total predictable monthly recurring revenue generated from active subscriptions, categorized by country. A chart helps visualize the revenue distribution across different countries, allowing businesses to analyze their geographical revenue trends.
How it's measured
Total MRR by Country = Total MRR of subscriptions during the period per country
Note:
Included in Total MRR by Country:
Included in Total MRR by Country (if configured):
Excluded from Total MRR by Country:
Reading
An increase indicates growing subscription revenue from specific countries, reflecting new sign-ups, upgrades, or renewals.
Interpretation
This metric helps businesses understand revenue distribution across countries. It enables companies to monitor performance in various regions, assess market potential, and identify growth or retention opportunities. Analyzing MRR by country informs market expansion strategies and pricing adjustments based on regional demand.
Example
In a given period: MRR for Country A = $25,000 MRR for Country B = $10,000 Total MRR by Country = $35,000
This metric measures the total monthly recurring revenue earned from active subscriptions, segmented by Plan Group (such as Freemium, Launch, Enterprise).
Explanation of metric
This metric represents the predictable monthly recurring revenue earned from subscriptions, segmented by different plan groups. It helps track which plan groups are generating the most revenue. The data is visualized as a chart, offering insights into how different plans contribute to total MRR over time.
Note:
This is available with RevenueStory (RS) premium only. To use this metric more efficiently, you have to configure a custom field at the Plan resource level in Chargebee and map it to the Plan group to a Plan resource in RevenueStory. However, you can configure and select your values in this custom field. It is recommended to configure meaningful values that are relevant to your business. To enable this, contact your Customer Success Manager or contact support.
How it's measured
Total MRR by Plan Group = Total MRR of subscriptions during the period per Plan Group.
Note:
Included in Total MRR by Plan Group:
Excluded from Total MRR by Plan Group:
Reading
An increase indicates higher MRR from a particular plan group, suggesting more customer sign-ups, upgrades, or better retention within that group.
Interpretation
This metric highlights which plan groups contribute the most to total MRR, providing insight into revenue concentration across different offerings. For example, older plans may continue to provide significant MRR if customer retention is high, but newer plan groups might be responsible for current growth. Tracking MRR across plan groups helps businesses make informed decisions about pricing strategies, plan optimization, and customer retention.
Example
In a given period:
200 subscriptions are on Plan A ($50/month)
50 subscriptions have a recurring addon ($10/month)
Discount per subscription = $10
Calculation:
MRR from Plan A = 200 × 50 = $10,000
Addon MRR = 50 × 10 = $500
Total discounts = 200 × 10 = $2,000
Total setup fees = $700 (excluded)
Total MRR by Plan Group = (10,000 + 500 - 2,000) = $8,500
Measures the total monthly recurring revenue earned from subscriptions, segmented by Customer Type (such as Individual, SME, Enterprise).
Explanation of metric
This metric tracks the predictable monthly recurring revenue from subscriptions, segmented by different customer types. It is visualized in a stacked bar chart, showing how different customer segments contribute to total MRR each month.
Note:
This is available with RevenueStory (RS) premium only. To use this metric more efficiently, you have to configure a custom field at the Customer resource level in Chargebee and map it to the Customer type to a Customer resource in RevenueStory. However, you can configure and select your values in this custom field. It is recommended to configure meaningful values that are relevant for your business. To enable this, contact your Customer Success Manager or contact support.
How it's measured
Total MRR by Customer Type = Total MRR of subscriptions during the period per Customer Type.
Note:
Included in Total MRR by Customer Type:
Included in Total MRR by Customer Type (if configured):
Excluded from Total MRR by Customer Type:
Reading
A decrease indicates lower revenue contribution from a particular customer type. This might suggest issues with retention, decreased demand, or increased churn within that segment.
Interpretation
This metric helps identify which customer types are generating the most revenue. An increase in MRR from a specific customer type indicates strong performance and suggests that this segment is a key target for growth. Conversely, a decrease may point to issues with that segment, such as higher churn or lower engagement. Focusing on high-growth customer types can drive revenue while analyzing and addressing the reasons behind low-growth segments can help improve overall business performance.
Example
In a given period, for an Enterprise Customer:
Calculation:
Measures the total monthly recurring revenue earned from subscriptions, segmented by Business Type (such as E-Commerce, SaaS, Ed Tech).
Explanation of metric
This metric tracks the predictable monthly recurring revenue from subscriptions, categorized by different business types. It is visualized using a chart, showing how various business types contribute to the overall MRR each month.
How it's measured
Total MRR by Business Type = Total MRR of subscriptions during the period per Business Type.
Note:
Included in Total MRR by Business Type:
Included in Total MRR by Business Type (if configured):
Excluded from Total MRR by Business Type:
Reading
An increase indicates higher revenue contribution from a particular business type, suggesting strong performance and interest in the product within that segment.
Interpretation
This metric helps identify which business types are generating the most revenue. An increase in MRR from a specific business type indicates that the segment is performing well and contributing to business growth. It can be used to target and expand efforts within high-performing segments. Conversely, a decrease may signal issues with that segment or a shift in revenue sources, which could warrant further investigation.
Example
In a given period, for a SaaS Business:
Calculation:
Measures the total monthly recurring revenue earned from subscriptions, segmented by metered and non-metered components.
Explanation of metric
This metric provides insight into the revenue generated from subscriptions based on whether the components are metered or non-metered. The data is presented using a chart, illustrating the distribution of MRR across these two categories during a specific period.
How it's measured
Total MRR by Metered and Non-Metered Components = Total Recurring MRR (Metered) + Total Recurring MRR (Non-Metered)
Note:
Included in Total MRR by Metered Components:
Included in Total MRR by Non-Metered Components:
Excluded from Total MRR by Metered and Non-Metered Components:
Reading
An increase indicates higher revenue from either metered or non-metered components, which can suggest more substantial usage or adoption of these components.
Interpretation
This metric helps understand the revenue composition across metered and non-metered components. It identifies how much revenue is coming from usage-based (metered) versus fixed-rate (non-metered) subscriptions. Analyzing this metric allows you to tailor retention programs and optimize revenue strategies based on the component type. For instance, if metered revenue is significant, focus on optimizing metered usage and related customer engagement.
Example
In a given period:
Measures the monthly recurring revenue earned from subscriptions, segmented by plan.
Explanation of metric
This metric illustrates the predictable Monthly Recurring Revenue (MRR) earned from each subscription plan. A chart represents this data, showing the contribution of each plan to the total MRR. Note that MRR from other subscription components, such as addons or recurring/non-recurring coupons, is not included in this metric.
How it's measured
Total MRR by Plan = Total MRR of subscriptions during the period per Plan.
Note:
Included in Total MRR by Plan:
Included in Total MRR by Plan (If Configured):
Excluded from Total MRR by Plan:
Reading
An increase indicates higher revenue from a specific plan, which could suggest a successful plan or increased customer adoption.
Interpretation
This metric helps identify which plan contributes the most to total MRR. It is useful to compare this with new MRR by plan to understand each plan's performance and retention. For example, a plan with high total MRR might have been popular among long-term customers, while current new MRR could come from different plans. Analyzing both metrics provides a comprehensive view of plan performance.
Example
In a given period:
Calculation:
Measures the monthly recurring revenue earned from subscriptions, segmented by addon.
Explanation of metric
This metric shows the predictable Monthly Recurring Revenue (MRR) earned from subscriptions, segmented by each addon. A chart visually represents this data, highlighting the contribution of each addon to the total MRR.
How it's measured
Total MRR by Addon = Total MRR of subscriptions during the period per Addon
Note:
Included in Total MRR by Addon:
Included in Total MRR by Addon (If Configured):
Excluded from Total MRR by Addon:
Reading
An increase indicates higher revenue from a specific addon, suggesting greater adoption or successful pricing.
Interpretation
This metric helps identify which addon contributes the most to total MRR. Comparing this with new MRR by addon provides insight into the performance and popularity of each addon. For example, an addon with high total MRR might have been popular among long-term customers, while new MRR could come from different addons. Analyzing both metrics gives a clear view of addon performance and customer trends.
Example
In a given period:
Calculation:
Measures the total Monthly Recurring Revenue (MRR) lost due to canceled subscriptions.
Explanation of metric
This metric tracks the total MRR lost when customers cancel their subscriptions. It does not account for the revenue lost from downgrades, only cancellations. It helps in identifying customer churn that impacts the company's revenue and prompts timely actions to reduce further losses.
How it's measured
Total Cancellation MRR = Sum of MRR lost from canceled subscriptions during the period.
Reading
A downward trend indicates a reduction in churn, which is positive for business sustainability.
Interpretation
An increase in Cancellation MRR not only reduces the current revenue stream but also means additional costs to acquire new customers to replace those lost. A rising Cancellation MRR is a warning sign to investigate why customers are canceling, at what point in the customer lifecycle this occurs, and if high-value customers are among those leaving. Understanding these factors can inform strategies to improve retention.
Example
If 5 subscriptions, each generating $100 MRR, were canceled in a month, the Cancellation MRR would be: 5 x $100 = $500
Measures the total Monthly Recurring Revenue (MRR) lost from canceled subscriptions, segmented by country.
Explanation of metric
This metric tracks the MRR lost when customers cancel their subscriptions, broken down by country. It helps businesses identify regions with higher customer churn, offering insights into where cancellations are most prevalent. This metric does not include revenue lost due to customer downgrades, only full cancellations.
How it's measured
Total Cancellation MRR by Country = Sum of MRR lost from canceled subscriptions during the period, segmented by country.
Reading
A downward trend Indicates lower customer churn in specific countries.
Interpretation
This metric helps identify countries where customer churn is highest, enabling the business to take targeted actions. An increase in Cancellation MRR in specific countries could signal issues with product-market fit, regional competition, or customer dissatisfaction. Investigating why customers in these countries are canceling can help inform customer retention strategies and improve localized support.
Measures the total Monthly Recurring Revenue (MRR) lost from canceled subscriptions, segmented by the type of churn (voluntary or involuntary).
Explanation of metric
This metric provides insight into the revenue lost from cancellations based on the reason for churn. A chart displays the MRR lost for each canceled subscription, subcategorized by churn type (voluntary or involuntary). It excludes revenue lost from downgrades and subscriptions canceled within the same activation period.
How it's measured
Total Cancellation MRR by Churn Type = Total MRR of Churned Subscriptions segmented by Churn Type. (voluntary or involuntary).
Note:
Cancellations within the same month of Activation are not included.
Reading
A downward trend indicates fewer cancellations.
Interpretation
This metric helps evaluate product offerings, plan pricing, and onboarding experiences by understanding the causes of customer churn. Voluntary churn suggests customer dissatisfaction with perceived value or service quality, while involuntary churn often points to payment or technical issues. Monitoring and analyzing these churn types can refine retention strategies and address the reasons behind cancellations.
Example
In a given period, 15 customers on a $10/month plan voluntarily churned, and 10 customers on a similar plan churned involuntarily.
Measures the total Monthly Recurring Revenue (MRR) lost from canceled subscriptions, segmented by subscription plan.
Explanation of metric
This metric displays the MRR lost due to subscription cancellations, with each bar in a bar chart representing the revenue lost for a specific subscription plan. However, this metric does not include the Revenue lost when a Customer downgrades.
How it's measured
Total Cancellation MRR by Plan = Total MRR of Churned Subscriptions segmented by Plan.
Note:
Cancellations within the same period of activation are not included.
Reading
A decrease in this metric is favorable and indicates lower churn and better customer retention.
Interpretation
The Total Cancellation MRR by Plan helps businesses understand how well different subscription plans are performing and whether the product offerings, pricing structure, or onboarding experiences are leading to customer dissatisfaction. It's particularly useful for identifying voluntary churn, where customers cancel due to perceived lack of value in a specific plan. Insights from this metric can guide product improvements and plan adjustments.
Example
In a given period, 15 customers from Plan A ($10/month) and 25 customers from Plan B ($15/month) cancel their subscriptions.
Measures the percentage of Monthly Recurring Revenue (MRR) retained over time from subscriptions activated during a specified period (cohort).
Explanation of metric
This metric tracks the retention of MRR from a cohort of subscriptions over the selected period. It provides insight into how much of the original MRR from a group of customers (activated in the same period) is retained over time. A table visualizes MRR retention, with the baseline MRR set at the time of subscription activation. This helps businesses analyze trends in customer retention and the long-term value of cohorts, aiding in understanding customer behavior post-activation.
How it's measured
MRR Retention Cohort = [(Total MRR at a particular period) / (Initial MRR)] x 100.
Note:
Initial MRR would be Total MRR at the time of Activation of Subscription. You can segment Total MRR and Initial MRR using Activation Period so that activated Subscriptions within the same Activation Period can be part of a similar Cohort.
Reading
An upward trend in this metric is favorable, indicating strong customer retention and, potentially, product engagement.
Interpretation
MRR Retention Cohort is a strong indicator of early customer churn, lead quality, and product engagement. Cohorts that maintain over 100% retention indicate that expansions, upgrades, or reactivations are outpacing churn, reflecting high lead quality. This metric is useful for analyzing the long-term value of customers and optimizing onboarding strategies for future cohorts.
Example
Cohort 1: 50 new subscriptions activated in the same period
Measures the total Annual Recurring Revenue (ARR) earned from new subscriptions within a specific period.
Explanation of metric
This metric tracks the ARR generated from newly acquired subscriptions, providing a clear picture of revenue growth from new customer acquisitions. A chart visualizes the contribution of new subscriptions to the overall ARR. The metric includes both customers who transition from trial to paid plans and future scheduled activations, making it a comprehensive measure of new ARR.
How it's measured
Total New ARR = Total ARR of the new subscriptions created during the period.
Note:
This includes subscriptions transitioning from "In Trial" to paid plans and any future scheduled activations.
Reading
A positive trend indicates growth, driven by new customer acquisitions and trial-to-paid conversions.
Interpretation
Total New ARR is a key metric for understanding the drivers of revenue fluctuations. A decrease in New ARR may signal issues with customer acquisition or onboarding, while an increase suggests a healthy pipeline of new customers. When evaluated alongside other metrics like Expansion ARR and Churn, it helps assess whether the business is growing or shrinking. If both Expansion ARR and New ARR are consistently lower than Churn, the business may be losing more revenue than it gains. On the other hand, higher New ARR combined with strong Expansion ARR indicates sustained MRR growth.
Example
In a given period:
To calculate the Total ARR for new subscriptions:
Total ARR = 150×300 = 45,000
This means that 150 newly acquired paid subscriptions, each with an average annual value of $300, generated a total of $45,000 in new ARR for that period.
If the average subscription value varied across different subscription tiers, the Total New ARR could also be derived by summing up the ARR contributions from each plan. For example, if 100 customers subscribed to a $250/year plan and 50 customers subscribed to a $400/year plan, the calculation would be:
So, the total New ARR would still equal:
Total New ARR = 25,000+20,000= $45,000
This detailed breakdown shows how the $45,000 figure was reached based on subscription volume and value.
Measures the total Annual Recurring Revenue (ARR) earned from new subscriptions, segmented by plan.
Explanation of metric
This metric tracks the ARR generated from new subscriptions, categorized by plan. A chart visualizes the contribution of each plan to the overall New ARR during a given period. The metric provides insights into which plans are driving the most revenue from new customers. It includes both customers transitioning from trial to paid plans and future scheduled activations, offering a detailed view of new ARR by plan.
How it's measured
Total New ARR By Plan = Total ARR of the New subscriptions created during the period per plan.
Note:
Includes IN TRIAL to Paid and Future scheduled activations.
Reading
A positive trend in a specific plan indicates that the plan is attracting new customers and driving revenue growth.
Interpretation
Total New ARR by Plan is essential for understanding how individual plans contribute to overall revenue growth. This segmentation helps identify which plans are performing well in terms of new customer acquisition and revenue generation. When analyzed alongside Expansion ARR and Churn, it provides a comprehensive view of the company's growth dynamics. If Expansion ARR and New ARR are lower than Churn, ARR may be shrinking. In contrast, a high New ARR combined with strong Expansion ARR suggests robust revenue growth across plans.
Example
In Q1, for Plan A:
New Subscriptions: 200 new customers transitioned from trial to paid.
Total ARR for New Subscriptions: $60,000 (This is calculated by multiplying the monthly recurring revenue from these new subscriptions by 12.)
For Plan B:
New Subscriptions: 100 new customers activated future scheduled subscriptions.
Total ARR for New Subscriptions: $30,000
Plan C saw fewer new sign-ups:
New Subscriptions: 50 new customers transitioned from trial to paid.
Total ARR for New Subscriptions: $12,000
In this quarter, Plan A contributed the most to new ARR growth with $60,000, showing that it was the most attractive option for new customers. This insight highlights Plan A's effectiveness in customer acquisition, possibly due to its pricing, features, or marketing efforts. Plan B followed with $30,000, while Plan C lagged behind, contributing just $12,000 to the total New ARR.
This example illustrates how Total New ARR by Plan can pinpoint which plans are driving revenue growth, allowing businesses to adjust strategies to improve performance in lower-contributing plans like Plan C, or leverage the success of high-performing ones like Plan A.
Measures the percentage of Monthly Recurring Revenue (MRR) lost from canceled subscriptions during a given period.
Explanation of metric
This metric tracks the rate at which revenue is lost due to canceled subscriptions. It provides a point-in-time indicator of churn, helping businesses understand the impact of cancellations on their recurring revenue. Cancellations within the same period of activation are excluded from this calculation. A lower cancellation rate suggests better customer retention, while a higher rate may indicate issues with product value, pricing, or customer satisfaction.
How it's measured
Cancellation MRR Rate = [(Total MRR of Churned Subscriptions during a period) / (MRR at the beginning of that period)] X 100.
Note:
Cancellations within the same month of activation are excluded.
Reading
A decreasing cancellation rate indicates improved customer retention and a reduction in lost revenue.
Interpretation
The Cancellation MRR Rate is a key metric for understanding customer churn and its impact on recurring revenue. It helps identify which plans are contributing to the highest churn rates, offering insights into potential areas for improvement, such as pricing optimization or product enhancements. A low cancellation rate suggests that the product is meeting customer needs, while a high rate may signal a need for intervention to retain customers.
Example
In a given period, 200 customers are on Plan A ($10/month).
Measures the percentage of Monthly Recurring Revenue (MRR) lost from canceled subscriptions, segmented by churn type (Voluntary or Involuntary).
Explanation of metric
This metric tracks the rate at which revenue is lost from both voluntary and involuntary cancellations, helping businesses differentiate between customers who choose to cancel (voluntary) and those who are canceled due to reasons like payment failures (involuntary). A chart visualizes the percentage of MRR lost from each churn type. This provides insights into the reasons for cancellations and the potential need for targeted interventions.
How it's measured
Cancellation MRR Rate by Churn Type = [(Cancellation MRR for a particular churn type during the period / Total MRR at the beginning of the period)] x 100
Note:
Cancellations within the same month of activation are excluded.
Reading
A lower cancellation rate for both voluntary and involuntary churn is desirable, indicating better customer retention and fewer lost subscriptions.
Interpretation
This metric helps identify which churn type (voluntary or involuntary) contributes more to revenue loss and is useful for prioritizing actions. For example, voluntary churn might require improvements in customer satisfaction or pricing adjustments, while involuntary churn might indicate a need for better payment recovery strategies. Monitoring this metric helps in optimizing both the product offering and operational processes to reduce churn.
Example
Total active subscriptions at the beginning of the period: 100
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Total Annual Recurring Revenue (ARR) lost from canceled subscriptions.
Explanation of metric
A chart visually represents the Total ARR Churn, illustrating the revenue lost due to cancellations over the year.
How it's measured
Total ARR Churn = 12 x Total MRR Churn
Note:
Total MRR Churn is equivalent to Cancellation MRR.
Reading
A downward trend indicates a reduction in ARR lost due to cancellations.
Interpretation
This metric is crucial for monitoring the overall health of the business. It helps identify whether churn is voluntary (customers canceling subscriptions due to dissatisfaction or perceived lack of value) or involuntary (cancellations due to issues like expired credit cards). Understanding these dynamics can guide retention strategies and inform product improvements.
Example
In a given period:
Total Annual Recurring Revenue (ARR) lost from paused, canceled, or downgraded subscriptions, segmented by plan.
Explanation of metric
A chart visually represents the Gross ARR churn, segmented by each subscription plan, illustrating how much revenue is lost due to cancellations and downgrades across different plans.
How it's measured
Gross ARR churn by Plan = 12 x Gross MRR churn by plan
Note:
Gross MRR churn by Plan = Cancellation MRR per plan
Reading
A downward trend indicates a reduction in ARR due to churn.
Interpretation
This metric is essential for monitoring the overall health of the business. It helps distinguish between voluntary churn (customers canceling due to dissatisfaction or perceived lack of value) and involuntary churn (e.g., cancellations due to expired credit cards). Understanding churn by plan can guide targeted retention strategies and identify areas for improvement.
Example
In a given period:
Annual Recurring Revenue (ARR) earned from subscriptions.
Explanation of metric
A chart illustrates the total predictable Annual Recurring Revenue generated from subscriptions. This metric provides a clear visual representation of the ARR over time.
A point-in-time KPI is also available, representing the total ARR during the current period. It displays the change in ARR compared to the previous period and shows the percentage change across different periods.
How it's measured
Total ARR = Total MRR x 12 during the period
Note:
Total MRR is calculated based on subscriptions during the period.
Included in Total MRR by Plan:
Included in Total MRR by Plan (If Configured):
Excluded from Total MRR by Plan:
Reading
An upward trend indicates growth in ARR.
Interpretation
Total ARR is a crucial metric for understanding the factors contributing to fluctuations in Annual Recurring Revenue. Analyzing this metric helps identify trends, evaluate the effectiveness of pricing strategies, and assess customer retention efforts, providing valuable insights for business growth.
Total Annual Recurring Revenue earned from subscriptions, segmented by Addon.
Explanation of metric
A chart illustrates the predictable Annual Recurring Revenue generated from subscriptions, segmented by each addon. The Total ARR by Addon reflects the ARR contributed by each addon, allowing for a detailed view of revenue streams.
How it's measured
Total ARR by Addon = (12 x Total MRR per addon)
Note:
ARR is derived from MRR, which includes recurring subscription components such as plans, addons, coupons, and any non-recurring components based on the settings configured in Chargebee. For clarity, refer to the formula for Total MRR by Addon.
Reading
An upward trend indicates growth in ARR from addons.
Interpretation
Total ARR by Addon provides insights into the recurring revenue generated from specific addons within your subscription model over a defined period. Analyzing this metric helps identify which addons are contributing positively or negatively to overall revenue, enabling informed decisions about product offerings and marketing strategies.
Example
In a given period, for a particular addon (Addon A):
Total MRR (Addon A) = $50,000
Total ARR by Addon (Addon A) = 50,000×12 = 600,000
Note:
Refer to the calculation for Total MRR by Addon for a deeper understanding of the MRR calculation per addon.
Total Annual Recurring Revenue earned from subscriptions, segmented by Plan.
Explanation of metric
A chart illustrates the predictable Annual Recurring Revenue generated from subscriptions, segmented by each plan. The Total ARR by Plan reflects the ARR contributed by each plan, providing a comprehensive view of revenue sources.
How it's measured
Total ARR by Plan = (12 x Total MRR per plan)
Note:
ARR is derived from MRR, which includes recurring subscription components such as plans, addons, coupons, and any non-recurring components based on the settings configured in Chargebee.
Reading
An upward trend indicates growth in ARR from plans.
Interpretation
This metric provides an overview of business performance on an annual basis. It enables SaaS and similar businesses to forecast growth more accurately, helping identify strong and weak areas in their subscription offerings.
Example
In a given period, for a particular plan (Plan A):
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