1.39% of subscription churn is involuntary, which points to payments issues.
The study examined a sample of over 1,500 subscription sites processing subscription billing on the Recurly platform from January to December 2018. Churn rates were calculated monthly by dividing the number of subscribers who churn during the month by the number of subscribers at the beginning of the month. The study used the median, 25th, and 75th percentile values to eliminate outliers and provide a more accurate representation of the data.
The statistic matters because it highlights the significance of addressing payment issues in order to reduce subscription churn. By recognizing that 1.39% of churn is involuntary, businesses can focus on resolving payment problems and implementing strategies such as customer support or automated payment reminders. This can ultimately improve customer retention rates and maintain consistent revenue streams.