Glossary
Churn Rate
Churn rate is the percentage of customers or members who leave in a given period.
Formula
Churn rate = customers lost in the period ÷ customers at the start × 100
Example
If 18 of 300 members cancel this month, monthly churn is 6%.
How to read it
A 6% monthly churn loses roughly half your customers in a year. Cutting it to 4% keeps far more.
Why it matters
Churn compounds. Cutting churn even slightly adds up to a large amount of revenue over a year.
Common mistakes
- Measuring churn only once a year, when it's too late to act.
- Ignoring 'silent churn', customers who stop showing up before they cancel.
- Not following up with people who leave.
How to improve Churn rate
- Track churn monthly, not yearly.
- Flag customers whose visits drop before they cancel.
- Ask people who leave why, and fix the most common reason.
- Offer a pause option instead of only cancel.
Related: Retention calculator
Related terms
Customer RetentionCustomer retention is how well a business keeps its existing customers coming back or staying subscribed over time.Win-Back CampaignA win-back campaign is a series of messages aimed at customers who have stopped buying or visiting, to bring them back.Customer Lifetime Value (LTV)Customer lifetime value, or LTV, is the total revenue you can expect from one customer over the whole time they stay with you.