Clear, practical definitions for the metrics, processes, and terminology that shape how subscription businesses operate — from billing and revenue recognition to churn, retention, and customer lifetime value.
Collections is the process a subscription business uses to recover payments that are outstanding or overdue, moving an unpaid invoice back to paid through a sequence of automated retries, customer communication, and, when those fall short, manual follow-up or external escalation.
Customer churn is the rate at which a subscription business loses customers over a given period, when they cancel their subscription or their subscription lapses and is not renewed.
Customer lifetime value is the estimated total profit or revenue a subscription business can expect from an average customer across the entire duration of their relationship, from the moment they sign up until the moment they churn.
Data migration is the process a subscription business uses to move its existing customer, billing, and subscription data out of a legacy system and into a new platform, so that accounts, subscriptions, and payment details remain intact and keep billing without interruption.
Dunning is the process a subscription business uses to recover a payment that has failed, by automatically retrying the charge and prompting the customer to fix whatever went wrong before the subscription lapses.
Retention rate is the percentage of customers a subscription business keeps over a given time period, measured against the customers it started that period with and excluding any new customers acquired along the way.
Revenue recognition is the accounting principle that determines when and how a business records revenue it has earned from a customer contract, rather than simply when cash arrives.
