10% of the total monthly sales churning on an absolute basis is near fatal. That means that within 5 months, you have 50% absolute churn per year, which reveals fundamental flaws with the service itself.
Anything above small single digit churn is telling you and your team that customers are not seeing enough value in your product. I'd start by doing as many exit interviews as you can with those that have churned out, including, offers to reengage at a lower price-point while you fix the issues that matter to them.
Happy to talk through this in more detail in a call.
In the SaaS world churn is just a fact of life. When it's so easy to sign up and to cancel services people are always going to leave.
I've been involved with many large SaaS companies and generally speaking, the lower the cost of the product, the higher the churn rate. This basically has to do with a whole lot of psychological stuff which, all summed up basically says: The bigger the decision the bigger the cost of having to change your mind.
Churn as a proportion of sales is definitely an important metric, and 10% isn't the best score. It's also not fatal.
What you really need to be paying attention to is the cause of the churn. You need to roll your sleeves up and understand WHY people are leaving and whether it has to do with something you're doing, something you're not doing... or it's just not a great fit for them and they naturally drop off.
Once you've identified the cause of the churn, you have a lot of really exciting options as to how you can cut back on the churn.
As a SaaS company, you have the ability to see exactly how every single customer uses your product, to feed that into a reactive database and to enable that database to reach out to "high risk" customers and to engage them and build a meaningful and successful relationship with them.
I won't lie and tell you that it's simple, or that you an swallow a magic pill and cut your churn rate in half... But by listening to your customers and working with people who "get" customer engagement you can reduce churn, increase customer satisfaction, and increase your bottom line.
anything >10% a YEAR would already be somewhat a concern for me (I do M&A of B2B SaaS companies)
10% a month is a big issue, either the product disappoints, the price is too high, or the engagement model isn't suited for SaaS and should be a one time purchase.
10% is considered to be pretty dangerous, to be honest, especially if the monthly value is 850. You should analyze your entire funnel to see where the customers are dropping off the most and then fix that part of it. You can use tools like cohort analysis, mixpanels, etc. for that.
