- Monthly Average Revenue Per User (ARPU) = Subscription Revenue / Average Subscribers
- Monthly Subscriber Churn Percent = Subscribers lost in month / Base of subscribers at beginning of month
- Gross Margin Percent = Gross Profit (from subscribers) / Subscription Revenue
- Subscriber Lifetime Value (LTV) = (Gross Margin Percent * Monthly Subscription ARPU) / Monthly Subscriber Churn Percent
- Customer Acquisition Cost (CAC) = Sales & Marketing Expenses / Gross Customer Additions
- Payback period (Breakeven points for each user) = Cumulative cash flow for average user
- Subscriber Return on Investment (ROI) = LTV / Customer Acquisition Cost
Some metrics such as gross margin and customer acquisition cost are too generic, and can be applied to all types of businesses. Also, we should define / set the meaning of success, based on the past data of already successful subscription businesses.