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What is Auto-renewal?

Definition, examples, and more

Definition

A subscription setting that automatically charges users at the end of each billing cycle unless manually canceled. Auto-renewal is the default for most in-app subscriptions and contributes to predictable recurring revenue. It’s important to actively engage and retain these users, as churn typically occurs when auto-renew is disabled.

How to Calculate

Auto-Renewal Rate = (Successfully Renewed Subscriptions / Total Subscriptions Eligible for Renewal) x 100. For example: 18,400 successful renewals / 20,000 eligible = 92% auto-renewal rate.

Example

A yoga app has 20,000 monthly subscribers on auto-renewal at $12.99/month. Each month, 92% successfully renew (generating $239,016), 5% fail due to billing issues (involuntary churn), and 3% actively cancel before renewal (voluntary churn).

Why Auto-renewal Matters

Auto-renewal is what makes subscription revenue predictable and compounding. A journaling app found that users who turned off auto-renewal were 8x more likely to churn than those who left it on. By sending a ‘here is what you will lose’ push notification 3 days before renewal to users who disabled auto-renew, they re-enabled 15% of them — saving $28K in monthly revenue.

Frequently Asked Questions

Can users turn off auto-renewal on iOS?

Yes. Users can manage auto-renewal through Settings > Apple ID > Subscriptions on their iPhone. When a user turns off auto-renewal, their subscription remains active until the end of the current billing period, then expires. Your app receives a notification of this change via server-to-server notifications.

How do I know when a user disables auto-renewal?

Apple and Google send server-to-server notifications when subscription status changes. With Botsi, you can listen for the ‘auto_renew_disabled’ event to trigger retention campaigns — like an in-app message offering a discount or highlighting features the user has not tried yet.

What percentage of subscription apps use auto-renewal?

Virtually all subscription apps on iOS and Android use auto-renewal — it is the default and recommended model for both app stores. The real question is what percentage of users keep auto-renewal enabled, which typically ranges from 70-90% depending on the app category and value delivery.

Category
Subscription App Terminology
Related Area
Mobile App Growth & Monetization

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