

Ask HN: What's your churn rate? - mattjung

A question to web-application providers: what percentage of your clients quit your service every month? is the rate different for free accounts compared to paying accounts?<p>p.s. Any links to some stats?
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jasonkester
Here are my numbers for S3stat. We don't have free accounts, though we do have
a 30 day trial.

    
    
      Visit to trial conversion:   3%
      Trial to paid conversion:    26%
      Average subscription length: 11.5 months
      Average cancels per month:   2%
    

Over time, those last two numbers keep getting better, since there's more time
passed for our first loyal customers to inflate the average subscription
length, and there's more people on board to lessen the impact of a few people
cancelling.

It's worth noting that you only need to calculate one of those last two
numbers to know the expected lifetime value of a visit to your site. Until you
asked the question, I had never actually calculated my churn rate as a
percentage of active users.

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paraschopra
Interesting stats. How long have you been running S3stat?

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jasonkester
The beta went live at the end of 2007, and I started charging for it in
February 2008.

S3stat goes squarely against one of the biggest pieces of advice I give to
fellow startup kids: Never base an entire product off a missing feature in
somebody else's thing.

Thus far Amazon have been good in keeping their AWS reports in the same state
of disarray I found them in 3 years ago. I don't expect it will stay that way
forever.

~~~
paraschopra
I'm sure by then you will find other successful niches :)

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pplante
No public stats I can personally provide. But I have seen it vary wildly
depending on the type of service. Businesses are generally slower to adopt a
new service/tool, and once they are locked in can be apprehensive for change.
Consumers can change on a whim if something better comes along.

Here are some interesting stats I found for Evernote:
[http://techcrunch.com/2010/05/28/video-evernote-ceo-phil-
lib...](http://techcrunch.com/2010/05/28/video-evernote-ceo-phil-libin-shares-
revenue-stats-and-how-to-make-freemium-work/)

Evernote has been pretty open in their stats over the course of their
existence.

~~~
dan_manges
It can also vary a lot within a type of service depending on the target
market. At Braintree our churn rate is higher for the start-ups that we work
with (because they sometimes go out of business) than it is for companies that
have been around longer and are profitable.

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paraschopra
Constant Contact is a public company, there for they share stats in their
annual report
[http://investor.constantcontact.com/common/download/download...](http://investor.constantcontact.com/common/download/download.cfm?companyid=CTCT&fileid=368991&filekey=8D782BD5-08BC-4DF8-9DA2-A5698A49E40B&filename=CTCT_09AR_4.26.10.pdf)

Some key stats. Their churn is ~2.5% and their cost of acquiring customer is
(whopping!) $370

PS: planning to write a post analyzing all such open stats. Do you know any
other public Internet companies?

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petervandijck
This might help too: for really crap services (say, weightloss or the like),
where people sign up and then pretty much never use the service, a typical
average churn rate is 3 months. ie. it takes people 3 months on average to
unsubscribe from a service they don't use.

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paraschopra
Are you speaking out of experience or do you have some stats? It seems
unlikely that people take at least 3 months to unsubscribe a service they
never use.

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petervandijck
Out of experience with 2 large services. Can't share stats, sorry. It may seem
unlikely, but it's true :) I'm talking average, many take up to 6 months. Now
you know why there are so many ads for crappy services online :) ps: I didn't
say "at least", I said "on average".

~~~
petervandijck
The math of subscription services generally goes like this: acquiring a paying
customer is going to cost you about 15-60$ each (for typical lifestyle
services). So lifetime value needs to be more than that. Once you're live, you
tweak those numbers, make acquisition more efficient and increase lifetime
value.

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thebigjc
Is there an equivalent or similar metric for non-subscription commerce sites?
I operate one, and I'm struggling to find good references on the best way to
determine I've 'lost' a customer.

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pospischil
Im working on a service, currently in private beta, that I think you (and lots
of others here on HN) would be interested in.

Shoot me an email and I'd love to tell you more about it: Pospischil at gmail

