How to calculate retention rate
Take the subscribers at the start of the period, count how many of those same subscribers remain at the end, and divide. If 10,000 began the month and 9,500 of them are still subscribed, monthly retention is 95% and churn is 5%.
Do not include subscribers who joined during the period. They belong to the next measurement.
Cohort retention
A single figure hides when people leave. Cohort retention follows everyone who joined in the same month and records what share remains after one month, two months, and so on.
The result is a curve. It falls fastest at the start, as people who joined for one title or one trial leave, then flattens. The level at which it flattens tells you how large your loyal base is.
Subscriber and viewer retention
- Subscriber retention: still paying
- Viewer retention: still watching, measured by day 1, day 7 and day 30 after sign-up
- Viewing is the leading indicator: subscribers who stop watching usually stop paying a few weeks later
What improves retention
- A regular release schedule, so there is always a next thing
- A strong first week: help new subscribers find a second title
- Annual plans
- Pause and downgrade options at cancellation
- Recovering failed payments
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