What churn is, and why the monthly rate matters

Churn is the share of members who cancel in a period. Divide last month’s cancellations by the members you started the month with and you have your monthly churn rate. Five cancellations from 100 members is 5% monthly churn.

A monthly figure hides how fast it compounds. At 5% a month, half of today’s members are gone in about 14 months. At 3%, that takes almost two years. The calculator turns your monthly rate into the yearly numbers that show up in your accounts: members lost, recurring revenue lost, and what each member is worth over their whole membership.

What to put in each field

Active members. Everyone currently paying a recurring fee. Leave out class-pack and drop-in customers; they have a different retention problem.

Average monthly price. Total monthly recurring revenue divided by active members. If you have several tiers, this blended figure is more useful than the headline price.

Monthly churn. Last month’s cancellations divided by members at the start of last month, as a percentage. If one month is unusual, average the last three.

Cost to acquire one member. Optional. Add up what you spend to win new members in a typical month (ads, intro offers, referral rewards, the staff hours spent on tours and follow-ups) and divide by the number who joined. Filling this in shows the second cost of churn: the money spent replacing people who could have stayed.

Reading the results

Recurring revenue walking out each year is the headline. It is the monthly fees that cancel over twelve months, added up. Your top line cannot grow until new sign-ups exceed this.
Average membership length is one divided by the churn rate. At 5% monthly churn the average member stays 20 months; at 8%, about a year.
Lifetime value is that length times the monthly price. It is the ceiling on what you can sensibly spend to acquire a member.
Cutting churn by one or two points shows what a small improvement is worth in kept revenue. This is usually the most persuasive number in the set, because retention work is cheap compared with acquisition.

What churn looks like in class-based businesses

Churn varies a lot by model. Studios that sell unlimited memberships to people with a strong routine tend to see lower churn than gyms whose members joined on a January promotion. Rather than chase an industry benchmark, track your own rate monthly and watch the trend. A two-point move in either direction is a signal worth investigating.

Two patterns show up almost everywhere:

Most cancellations happen early. Members who have not found a class they love within the first 30 to 60 days rarely stay. Onboarding is a retention lever, not just a welcome.
Cancellations cluster around schedule changes. When a favourite class moves or a coach leaves, a chunk of that class leaves too.

The retention levers that cost the least

Onboarding to a specific class. Book a new member into a named session with a named coach in their first week. “Come whenever” is how people never come.
Ask before you change the schedule. Cutting a class that twelve regulars rely on to add one nobody asked for is the fastest way to lose twelve members. Put schedule ideas to a vote and let the numbers decide.
Make it easy to pause instead of cancel. A freeze option keeps the relationship alive through injuries, travel and busy months.
Recover failed payments quickly. A surprising share of “churn” is expired cards. Automate the retry and the reminder.
Notice absence. A member who has not visited in three weeks is telling you something. A friendly message from a coach beats a re-engagement discount.

The number the calculator cannot give you

It cannot tell you why people leave. Exit surveys help, but the cheaper signal is upstream: members who feel heard about what goes on the schedule stay longer. Asking them to vote on next month’s classes costs nothing and tells you both what to add and what not to cut.