Subscriber Growth Rate
Date created: Oct 12, 2022 • Last updated: Oct 12, 2022
What is Subscriber Growth Rate?
Subscriber Growth Rate measures the percentage growth of an application’s account base in a given time period compared to the previous time period. The time period can be a week, a month, a quarter, or a year.
Subscriber Growth Rate Formula
How to calculate Subscriber Growth Rate
A software company has 100 subscribers at the end of the previous month and 150 subscribers at the end of the current month. It has achieved a 50% Monthly Account Growth Rate.
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How to visualize Subscriber Growth Rate?
Growth Rates are best visualized with line charts. This lets you identify where your Subscriber Growth Rate has increased or decreased, allowing you to act on discrepancies.
Subscriber Growth Rate visualization example
Subscriber Growth Rate
Line Chart
Subscriber Growth Rate
Chart
Measuring Subscriber Growth RateMore about Subscriber Growth Rate
Subscriber growth is an important metric for a SaaS platform because it shows period-over-period momentum, or lack thereof, for an application. A positive Subscriber Growth Rate shows that the application is gaining traction in the marketplace. A flat or declining Subscriber Growth Rate can be an early warning sign of potential application stagnation or decline. Variability in the Subscriber Growth Rate, measured monthly, can also be an indication of seasonal trends.
Especially for a new business that is yet to generate revenue, Subscriber Growth Rate is a key metric to track because it can help predict future revenue generation based on current momentum.
In addition to tracking Subscriber Growth Rate, it is also useful to calculate the compound growth rate over a period of time. When done monthly, this is known as the Compound Monthly Growth Rate (CMGR).
Recommended resources related to Subscriber Growth Rate
This article explains how to calculate Compound Monthly Growth Rate and the best practices as well as the interpretation of Monthly Account Growth Rate.Metric Toolkit
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