Churn Rate

App retention refers to the capacity of an application to sustain users' engagement and activity for a specified duration after they have downloaded and installed it on their devices. It gauges the proportion of users who revisit the app after their initial download and reuse it. Essentially, app retention is an indicator of user loyalty and demonstrates the app's ability to deliver a positive user experience and satisfy user requirements over time. Retention rates are typically measured on Day 1, Day 7, and Day 30. High app retention rates are critical for the success of an app because they suggest that users perceive value in the app and are inclined to continue using it in the future.

Voluntary churn occurs when a subscriber actively decides to cancel their subscription — they make a conscious choice to stop paying, typically because they no longer perceive sufficient value, found an alternative, or their needs changed. Involuntary churn occurs when a subscription lapses without the user's deliberate intent — most commonly due to a failed payment (expired credit card, insufficient funds, bank-side decline) that isn't resolved before the subscription expires. The distinction matters enormously because the two types of churn require completely different intervention strategies. Voluntary churn is addressed through product improvements, value communication, cancellation deflection flows (offering discounts, plan pauses, or downgrades when a user attempts to cancel), and win-back campaigns. Involuntary churn is addressed through payment recovery mechanisms — smart retry logic, grace periods, dunning communications, and frictionless payment update flows. For many subscription apps, involuntary churn accounts for 20–40% of total churn, representing a significant and often underaddressed revenue leak. Apps using web-based billing have more control over involuntary churn recovery because they own the billing relationship and can implement custom retry schedules, direct email communications, and web-based payment update pages without being constrained by app store billing system limitations.

LTV meaning, Lifetime Value (LTV), is a performance indicator used to evaluate the total earnings generated by a customer throughout their entire tenure of using a mobile application. Historical data on user retention rates is often used to estimate the expected duration of user engagement. Having knowledge of what is LTV and the average LTV of your customers is crucial for executing successful marketing strategies. LTV in marketing for mobile apps is normally used to optimize revenue streams such as subscriptions, in-app advertising, and in-app purchases by determining the amount of money that can be spent on user acquisition while still being profitable.

Net Revenue Retention (NRR), also called Net Dollar Retention (NDR), measures the percentage of recurring revenue retained from existing customers over a given period, including the effects of upgrades, downgrades, and churn. An NRR of 100% means the business retains all of its existing revenue; above 100% means expansion from existing users exceeds losses from churn and downgrades. For subscription apps, NRR is a powerful indicator of product-market fit and monetization health. An app with 110% NRR is growing its revenue base by 10% from existing users alone, before any new customer acquisition — a strong signal that users find increasing value over time. NRR above 100% is often driven by users upgrading to higher-priced plans, purchasing add-ons, or re-subscribing after a lapse. Conversely, NRR below 100% indicates that the business must continuously acquire new subscribers just to maintain its current revenue level, putting pressure on user acquisition efficiency. Top-performing subscription businesses typically achieve NRR of 110–130%, and investors consider this metric one of the strongest predictors of long-term sustainable growth.

A reactivation campaign (also called a re-engagement or win-back campaign) is a marketing initiative specifically designed to bring back users who have previously churned, lapsed, or become inactive. Unlike retention efforts that target currently active users, reactivation campaigns focus on users who have already disengaged — whether they unsubscribed, stopped opening the app, or uninstalled it entirely. Effective reactivation campaigns leverage multiple channels including push notifications (for users who still have the app installed), email (for users who uninstalled but provided an email), paid retargeting ads, and SMS. The messaging typically highlights what's new since the user left, offers a special incentive to return (such as a discounted subscription rate or extended free trial), or triggers an emotional connection to the value the user previously experienced. For subscription apps, reactivated subscribers often have higher retention rates than first-time subscribers because they already understand the product's value proposition.