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Subscription Pricing Calculator

Work out subscription pricing instantly with clear inputs, formula shown and shareable results.

About Subscription Pricing Calculator

Subscription pricing has two levers: the headline monthly rate and the prepay discount that buys cash up front and suppresses churn. Lifetime value follows from churn — average lifetime is the reciprocal of the monthly churn rate — and should be measured on gross margin, not revenue.

Formulas

Annual plan price

Annual = Monthly x 12 x (1 - Annual discount %)

Lifetime value

LTV = Monthly price x Gross margin % / Monthly churn %

Worked example

With the default values below, Subscription Pricing Calculator returns Annual plan price of $288.84. Change any input above and every figure here is recalculated in your browser.

Inputs used

Monthly plan price
29
Discount on annual prepay
17
Monthly churn rate
3.5
Gross margin on revenue
78

Results

Annual plan price
$288.84
Effective monthly rate on annual plan
$24.07
Average customer lifetime
28.6
Gross-margin LTV (monthly plan)
$646.29

Step by step

  1. 1Values used
  2. 2Annual plan price
  3. 3Lifetime value
  4. 4Annual plan price= 288.84
  5. 5Effective monthly rate on annual plan= 24.07
  6. 6Average customer lifetime= 28.6
  7. 7Gross-margin LTV (monthly plan)= 646.29

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax or fees or charges into account.
  • Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

How big should the annual discount be?

Two months free (about 17%) is the common anchor. Anything beyond 25% rarely improves conversion enough to justify the revenue given up.

Why use gross margin in LTV?

Because hosting, support and payment fees are real costs of serving the customer. Revenue LTV overstates what you can afford to spend on acquisition.

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