SaaS start-up Groove had a problem.
It was signing up plenty of new users, but monthly churn was 4.5%. So it dug through its data looking for "red flag" behavior. Customers who left spent about 35 seconds per session. Customers who stayed spent more than three minutes.
Groove emailed the short-session group and offered to help them finish setting up. Churn fell by 71%.
That's the whole game. Find out why people leave, then act before they do. This checklist turns the churn chapter of The Subscription Playbook into 21 questions, so you can see where your customers are most likely to slip away.
How do you use the Churn Risk Checklist?
- Answer each question Yes, Partly or No for your business today. "Partly" means you do it sometimes, or only for some customers.
- Add your MRR and monthly churn if you know them, to see what churn costs you each year.
- Work the fix list from the top. It's sorted by impact, and each fix links to the guide that shows you how.
The questions follow five areas: Measure (define success, dashboards, red flags, a 360-degree view, real-time alerts), Onboard (onboarding, the first "aha", high touch for 90 days), Engage and grow (segmentation, a feedback loop, upsells, loyalty, habit), Billing (failed payment recovery) and Exit (cancellation, pause, offboarding, win-back).
How the risk score works
Each practice carries a weight of 1 to 3, based on how directly it drives churn in the book's case studies. A "No" counts as a full gap, "Partly" as half a gap.
Churn risk score = Sum of (weight × gap) ÷ Sum of all weights × 100 Annualized churn = 1 − (1 − monthly churn)^12
The second formula matters more than people think. Monthly churn of 4% sounds small. Over a year it compounds to about 39% of your customers.
A worked example
The preloaded answers describe a typical small subscription business with $20,000 of MRR and 4% monthly churn. It has a dashboard, an upgrade path, an annual plan and an easy cancel button. But it doesn't know its red-flag behaviors, has no alerts, has never defined its first "aha" moment, has no dunning sequence and offers no pause.
Result: 63 out of 100, high churn risk, with Measure and Onboard the weakest areas at 31% each. About $9,600 of MRR walks out the door every year.
The top fixes are exactly the Groove playbook: find the early behavior that predicts staying, set alerts for anyone who hasn't done it, and shorten the path to the first "aha." Then fix failed payments, which is often the fastest win of all because those customers never meant to leave.
How do you read your result?
- Under 25 (low): your basics are in place. Look for expansion revenue to reach net negative churn.
- 25 to 44 (moderate): the foundations are there, but gaps will let customers drift. Fix the top items this quarter.
- 45 to 64 (high): customers are probably leaving for reasons you can't see yet.
- 65 and above (severe): start with measurement and failed payments.
For "what good looks like" in churn itself, compare your rate with real company figures on the churn benchmarks page rather than a made-up average. Benchmarks vary hugely by industry and price.
One honest caveat from the book. I've used Slack for years without an account manager, a training session or a loyalty program. I stay because it's simple and useful. If you need every practice on this list just to keep people, the real problem may be product/market fit.
What to do next
- Measure churn properly with the churn rate calculator.
- Read the four tips and nine best practices in how to reduce churn.
- Recover failed payments with the involuntary churn guide.
- Build a cancellation flow that saves customers legally, especially if you sell to Australians before the 1 July 2027 rules.
Frequently asked questions
What is the most common reason customers churn?
Most voluntary churn comes down to customers not getting enough value, or not noticing the value they get. That often starts in the first weeks, when a customer never finishes setup or never reaches their first result. The rest is usually price, a change in circumstances or a better alternative. Failed card payments are a separate, often fixable cause called involuntary churn.
Which churn fix should I start with?
Start with the top item on your fix list, which weighs impact and how big the gap is. For most businesses that means measurement first (you can't fix what you can't see), then failed payment recovery, because those customers never wanted to leave. After that, shorten the path to the first 'aha' moment, which is where most early churn begins.
Does making cancellation easy increase churn?
It can lift churn for a while, because it exposes customers who were only staying because leaving was hard. But that churn was always there, and it tends to show up as chargebacks, complaints and bad reviews instead. Hard-to-cancel flows have also become expensive: Amazon's 2025 FTC settlement was $2.5 billion, and Australia's easy-cancellation rules start on 1 July 2027.
How often should I run this checklist?
Run it once now, then every quarter while you're working through the fixes. Re-run it whenever churn jumps, after a price change, or after a big product or billing change. Your answers save in your browser, so you can come back and update them and watch the risk score fall as each practice moves from No to Yes.
Built on The Subscription Playbook
This tool turns frameworks from Robert Coorey's book into something you can use in minutes. Robert is the author of The Subscription Playbook and a Director at BPAG Accountants. More about Robert.