Freelancers 
Advertisers 
Churches 
Charities 
Free Plugin 
Free vs Pro 
Reviews 
Blog Glossary
Subscription Billing
Glossary
Plain-English definitions of every subscription billing term — explained in the context of WooCommerce.
3D Secure (3DS / 3DSv2)
A bank-driven authentication step that verifies the cardholder is the one making the purchase.
Annual Recurring Revenue (ARR)
MRR × 12 — the annualized value of your subscription revenue used for strategic planning and investor reporting.
Automatic Renewal
The default behavior where subscriptions renew without requiring customer action.
Average Revenue Per User (ARPU)
Total subscription revenue divided by the number of active subscribers in a period.
Billing Cycle
The recurring time interval between subscription charges, typically weekly, monthly, quarterly, or annually.
Chargeback
A disputed transaction where the customer's bank reverses the charge after they file a complaint.
Churn Rate
The percentage of subscribers who cancel or fail to renew within a given time period.
Customer Acquisition Cost (CAC)
The total cost to acquire one paying customer, including marketing, sales, and overhead.
Customer Lifetime Value (LTV)
The total revenue a single customer generates over their entire relationship with your business.
Dunning Management
The automated process of recovering failed subscription payments through retries and customer notifications.
Failed Payment
A subscription renewal charge that was declined by the payment gateway or the customer's bank.
Free Trial
A limited period of access before billing begins, used to reduce signup friction and let customers experience value.
Freemium
A pricing model offering a free tier with limited features alongside paid premium tiers.
Involuntary Churn
Subscriber loss caused by failed payments rather than a deliberate decision to cancel.
Monthly Recurring Revenue (MRR)
The total predictable monthly revenue generated by all active subscriptions, normalized to a monthly figure.
Net Revenue Retention (NRR)
The percentage of MRR retained from existing customers after expansion, contraction, and churn.
Payment Gateway
The service that securely processes and authorizes payments between customers and merchants.
Proration
Adjusting a charge or credit based on the portion of a billing period a customer actually uses when changing plans.
Recurring Payment
A transaction that automatically repeats at a fixed interval without the customer re-authorizing each charge.
Split Payment
Dividing a product's total price into multiple scheduled installments, ending automatically when the total is paid.
Subscription Billing
A business model where customers pay at regular intervals for ongoing access to a product or service.
Subscription Box
A recurring physical-product delivery model where customers receive curated items on a regular schedule.
Subscription Cancellation
The process by which a subscriber ends their active subscription, stopping future billing.
Subscription Pause
Temporarily suspending a subscription so billing stops but the subscription is not cancelled.
Subscription Renewal
The automatic rebilling that occurs at the end of each billing cycle, extending an active subscription.
Subscription Upgrade & Downgrade
Changing a subscriber's plan to a higher-priced (upgrade) or lower-priced (downgrade) tier mid-subscription.
Tiered Pricing
A pricing strategy offering multiple plan tiers (Basic, Pro, Enterprise) at different price points and feature sets.
Trial Period
A defined window of access before billing starts, used to let customers evaluate a product before committing.
Usage-Based Billing
A pricing model where customers pay based on consumption rather than a fixed monthly fee.
Webhook
An automated HTTP message a service sends to your store to notify of an event in real time.
How-to Guides
Ready to implement?
See our step-by-step guides for setting up every subscription feature in WooCommerce.
