Reducing Churn in Subscription Services

Ben Orenstein

You’ve probably heard by now that we’ve launched a learning community for passionate Rails developers called Prime.

Since Prime is a subscription service, one of metrics we’re interested in is churn, defined as the percentage of total customers who cancel. Over the last 30 days, Prime’s churn has been 18%.

Estimates of what a “good” churn is vary. One broad survey of SaaS companies with less than $10M in revenues showed a median churn of 20%, while some blog posts insist that anything over 8% should be panic-inducing.

To gain some perspective and get advice, I reached out to a friend and former podcast guest, Brennan Dunn.

Brennan is creator of a successful SaaS app called Planscope, author of several excellent ebooks, and overall “good at making money on the internet” kind of guy.

Below, you’ll find a recording of our 40-minute chat. In it, we dig into Prime’s current stats (including subscriber count and revenue growth), and Brennan’s suggestions for how to improve the site. What started off as recommendations for reducing churn turned into a broader discussion of how to position the entire service. If you run a subscription service of your own, you’ll likely learn a thing or two from Brennan’s battle-tested advice.

Check it out!

Direct download.

If our discussion left you with further questions for Brennan, leave them in the comments below and perhaps we can convince him to respond.