Also known as: Customer attrition, Customer churn
The percentage of clients who cancel within a given period (usually per month or year). Keeping churn low is essential to an agency's health, since winning new clients costs more than retaining existing ones.
A good agency has a monthly churn of 2-5%. Higher than 10% per month is alarming — it means you lose half your client base every 10 months and therefore have to keep winning new clients just to hold the same MRR.
Churn can be measured at two levels: (1) customer churn (how many clients cancel), (2) revenue churn (how much MRR you lose — more meaningful because one large client weighs heavier than five small ones). For agencies, long-term client retention is worth more than aggressive growth: a client who stays 3 years is worth their weight in gold.
An agency starts January with 20 clients. In the first month 2 clients cancel = 10% monthly churn. A warning sign — the agency digs in and finds both clients were unhappy with reporting quality. The fix: automating reports. Churn drops to 3% in the following months.
The predictable monthly revenue an agency (or SaaS company) generates from subscriptions — a key KPI because it measures stable income, unlike one-off projects.
A pricing model where an agency (or software vendor) pays per active client they manage — instead of per user, per social account or per feature.
A pricing model where an agency (or software vendor) pays per active client they manage — instead of per user, per social account or per feature.
The predictable monthly revenue an agency (or SaaS company) generates from subscriptions — a key KPI because it measures stable income, unlike one-off projects.
The total revenue (or profit) a customer generates on average over the entire relationship — crucial for deciding how much you can invest in customer acquisition.
The total cost of winning one new customer — including marketing, sales hours and tooling. A healthy CAC is far lower than LTV (ratio of at least 1:3).
Client portal, content planning, AI captions, white-label reporting — all in one tool. Try it free for 14 days.