MRR Churn threatens your Monthly Recurring Revenue by destroying your MRR momentum. To be successful (and emulate the most successful SaaS businesses in the world) you must calculate and optimize MRR Churn correctly. Here we walkthrough exactly how to calculate SaaS MRR churn, including what to and not to include in the calculation, as well as how to optimize this crucial SaaS metric.

1. MRR Churn:
Calculating and Optimizing
Price Intelligently’s SaaS Metric Mondays
SaaS MRR ChurnPrice Intelligently

2. Let’s talk about MRR Churn
MRR Churn
Your SaaS company’s silent killer.
SaaS MRR ChurnPrice Intelligently

3. MRR =
Monthly Recurring Revenue
Churn =
A measure of attrition or loss
SaaS MRR ChurnPrice Intelligently

4. MRR Churn =
The monthly erosion of your SaaS monthly recurring
revenue. You can define the metric as an absolute dollar
amount ($40,256) or as a percentage (-6.34%) which is
more actionable to track over time.
MRR Churn
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5. MRR Churn
Here’s How You Breakdown MRR Churn Visually
(image taken from ProfitWell – free SaaS Metrics dashboard)
SaaS MRR ChurnPrice Intelligently

6. All that stuff is great but…why
should you even care?
MRR ChurnSaaS MRR ChurnPrice Intelligently

7. “Not tracking MRR Churn is like
flying a plane with your fuel tank on
fire”
MRR ChurnSaaS MRR ChurnPrice Intelligently

8. More specifically…
MRR Churn
Understanding your MRR Churn can help
Identify which aspect of
your product is causing
churn
Product
Improve projections and financial
planning models to account for
lost MRR
FinanceMarketing
Identify channels bringing
in crappy/happy
customers
SaaS MRR Churn
See the breakdown of your MRR Churn with ProfitWell >>
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9. Lets go even deeper and
calculate MRR churn like a
#boss
MRR ChurnSaaS MRR ChurnPrice Intelligently

10. It’s all about the money leaving
your business
Always remember – with MRR Churn look at the
Cancellations not upgrades or downgrades
MRR ChurnSaaS MRR Churn
MRR Churn Criteria Breakdown
Items to Include Items to Exclude
Active Cancellations Upgrades
Delinquent Charges Downgrades
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11. MRR Churn
MRR Churn = ∑ MRR Cancellation + ∑ MRR
Delinquent
OVERALL EQUATION:
MRR Churn
=
MRR
CANCELLATION
1
+ MRR
CANCELLATION
2
MRR
CANCELLATION
n
…
MRR
DELINQUENT
1
MRR
DELINQUENT
2
MRR n
DELINQUENT
n
…+
BREAKDOWN:
$1,000 (MRR Churn) =$800 (MRR Cancellations) + $200 (MRR Delinquen
EXAMPLE:
+
SaaS MRR Churn
Talk SaaS nerdy to me…
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12. MRR Churn
Once you know how to
calculate like a #boss you can
optimize like an even bigger
#SaaS superstar
SaaS MRR ChurnPrice Intelligently

13. MRR Churn
Here’s how to eliminate as much
MRR Churn as possible:
1. Recover delinquent credit
cards
2. Increase your active users
3. Fix your pricing strategy
4. Run churn loss surveys
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$
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$ $
$
$
$
$
$
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$
SaaS MRR ChurnPrice Intelligently

14. MRR Churn
Delinquent credit cards are the biggest piece
of low hanging fruit (~20-40% of MRR
Churn). Put in a system that can recover
those numbers ASAP.
Key Optimization #1
Recover Delinquent Credit Cards
SaaS MRR ChurnPrice Intelligently

15. MRR Churn
This is much easier said than done, but a lot of active
cancellations come from individuals who don’t get hooked into
habitually using your product. Obsess over active users.
Key Optimization #2
Optimize Your Active Users
SaaS MRR ChurnPrice Intelligently

16. MRR Churn
Improper pricing can heavily influence your MRR churn, especially
if you don’t have a proper value metric or your customers just
don’t match your product’s value with your price.
Key Optimization #3
Fix Your Pricing Strategy
SaaS MRR ChurnPrice Intelligently

17. MRR Churn
You’re likely missing the true reasons folks are leaving your product. Running
proper customer loss surveys that force respondents to choose the biggest
reason(s) their leaving will help you identify these reasons real quick.
Key Optimization #4
Run Churn Loss Surveys
SaaS MRR ChurnPrice Intelligently

18. MRR Churn
Boom. You’re now an MRR Churn
rock star*.
SaaS MRR Churn
*…or just a normal SaaS aficionado that’s more informed and hopefully learned something useful.
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19. MRR Churn
Want real time SaaS Metrics (including MRR
Churn)?
Know and understand your SaaS Metrics
with ProfitWell for free - the most accurate
metrics on the market.
SaaS MRR Churn
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