Ch2

p.44

 

p.44

Note that the churn rate does not use the total subscribers at the end or the subscribers acquired.

 

p.45

the churn rate is based only on churn in relation to the subscribers at the start. If the churn were instead divided by the area of the end subscriber pool, it would be incoherent because that would mix parts of two pools and confuse the contributions of acquisition and retention with the size of the subscriber pool.

 

p.48

net retention ignores new revenue acquired from signups during the time period. On the other hand, an important fact about net retention is that it includes changes in revenue from subscribers who are retained if this occurs.

 

p.49

 

p.54

 

p.55

This netting property of net retention makes it somewhat less useful for fighting churn than the other definitions of churn. This is because including down sells and upsells are not the same, and conflating them confuses the issue. It is logical to include down sells in the churn calculation because that is the part of revenue that was present at the start but was lost from customer disengagement.

 

p.55

Net retention is not the most useful measure for fighting churn, but it is nevertheless remarkable because of the following fact about churn-reporting practice.

 

TIP Net retention is the preferred measure of churn to report to outside inves- tors in subscription companies.