Metric: Gross and Net MRR churn rates

The Gross MRR Churn Rate reports the rate at which you are losing MRR through contractions and cancellations.

You can view your Gross MRR Churn Rate at https://app.chartmogul.com/#charts/gross-mrr-churn

The Net MRR Churn Rate reports the rate at which you are losing MRR through downgrades and cancellations, offset by the impact of expansions and reactivations. 

You can view your Net MRR Churn Rate at https://app.chartmogul.com/#charts/net-mrr-churn.

 

How is it calculated?

Gross MRR Churn rate

(SUM of Churn & Contraction MRR) / MRR at start of period

Net MRR Churn rate

(SUM of Churn & Contraction MRR - SUM of Expansion & Reactivation MRR) / MRR at start of period.

 

What analysis can be gained?

These graphs are useful if you want to analyse at which rate you are losing MRR. 

The Gross MRR Churn rate gives you a realistic picture of your revenue churn and helps you understand the overall health of your business.

The Net MRR churn rate can paint a more positive picture, as it includes the strength of your customers upgrade activity. It is a popular metric to monitor efforts of a customer success team. 

You can segment these graphs using the segmentation tools. For example, you could see the Net MRR Churn Rate for customers who responded negatively to a Net Promotor Score (NPS) survey.

 

Further reading

Learn more about churn rates in The Ultimate (SaaS) Churn Rate cheat sheet.