Monthly churn benchmark
Software churn averages about 4.8% monthly in Recurly's 2022 benchmark view, with overall subscription churn near 5.6%.
Source: Recurly churn rate guideSaaS retention usually breaks down into two separate problems: people who never reach value and customers who would have stayed if their renewal had not failed. Recurly's subscription benchmarks put software churn near the low end of subscription categories, but even a roughly 5% monthly churn rate compounds fast when trial conversion, activation, and card recovery are weak.
The benchmark numbers below are directional, not guarantees. They are most useful when you compare your own cohorts by billing cadence, acquisition source, and payment method so you can separate true product churn from renewal failures that a better dunning system could have recovered.
Use benchmarks to set expectations, not to flatten the nuance in your business. A healthy retention strategy usually starts with the benchmark, then moves into cohort analysis so you can see where churn is coming from and which parts of it are recoverable.
Software churn averages about 4.8% monthly in Recurly's 2022 benchmark view, with overall subscription churn near 5.6%.
Source: Recurly churn rate guideRecurly's annual billing benchmarks show B2B median churn at 5.15%, lower than B2C median churn at 6.81%, because software purchases are usually more deliberate and stickier.
Source: Recurly annual billing metrics reportIn 2023, median involuntary churn was 1.0%, and 8.3% of renewal invoices failed on the initial payment attempt.
Source: Recurly 2024 State of SubscriptionsMedian dunning recovery rate was 49.0%, showing how much revenue is recoverable when retries and messaging are coordinated.
Source: Recurly 2024 State of SubscriptionsChurn usually shows up as a mix of product friction, pricing questions, and billing issues. The patterns below are the ones most likely to move both voluntary churn and involuntary churn in this category.
A large share of SaaS churn starts before a customer has formed a habit. Trial signups look healthy, but users leave when they never import data, invite teammates, or trigger the first outcome that makes the product feel necessary rather than optional.
If acquisition targets curiosity instead of a real operational pain point, trial-to-paid conversion and first-month retention both suffer. Teams often misread this as a pricing problem when the real issue is that too many buyers were never a strong fit for the workflow in the first place.
SaaS operators frequently focus on cancellations and underinvest in renewal failures. The result is avoidable involuntary churn from expired cards, insufficient funds, generic declines, and issuer friction that can remove good customers without any product dissatisfaction.
Churn often shows up first as seat contraction, reduced usage, or downgraded plans. When product, finance, and customer success do not monitor those early signs together, accounts drift into cancellation before anyone steps in with a save motion.
Most operators do not need ten new lifecycle campaigns. They need a tighter first-value journey, better cohort segmentation, and cleaner renewal recovery so good customers are not lost to avoidable friction.
Pick the one behavior that proves a new account reached value, such as connecting a data source, publishing the first workflow, or completing a first report. Drive every email, in-app nudge, and customer success handoff toward that event rather than generic product tours.
Track voluntary cancellations and failed renewals as different problems with different owners. If failed payments are bundled into one top-line churn number, teams tend to overbuild retention content while underfunding the payment recovery systems that would have saved willing customers.
Self-serve monthly plans, annual plans, and sales-assisted accounts usually behave very differently. Measuring them together hides whether churn is mostly coming from weak onboarding at the low end or procurement and stakeholder turnover at larger accounts.
A trial that converts without product adoption usually creates a future cancellation. Use lead qualification, usage thresholds, and better pre-conversion education so paid customers arrive with clearer expectations and a stronger path to repeat value.
A good dunning flow does more than send one failed-payment email. It times retries intelligently, prompts customers before expiry when possible, and keeps messaging aligned with invoice state so finance and growth teams do not lose recoverable revenue to generic decline handling.
RevGuard is most useful when some portion of churn is really failed payment churn. That is common in recurring businesses because renewal failures can look like normal attrition unless you track invoice state and recovery separately from product behavior.
If you know your customer count, average revenue, and a rough failed payment rate, you can estimate how much churn may be sitting inside renewal failures instead of real cancellations.
These pages use publicly available benchmark sources and industry research. Review the linked material directly before adopting any benchmark as an internal target.