Churn Rate
Definition
The percentage of customers or revenue lost during a specific period, calculated by dividing churned customers (or revenue) by the total at the start of the period.
Churn rate is expressed as both customer churn (logo churn) and revenue churn (dollar churn). Monthly churn of 2% compounds to roughly 22% annually, illustrating why even small churn rates demand attention. Churn rate varies significantly by segment -- SMB products often see 3-5% monthly churn while enterprise products target below 10% annual churn. Analyzing churn by cohort, segment, and reason helps identify systemic issues and prioritize retention investments.
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FAQ
What does Churn Rate mean?
Churn rate is expressed as both customer churn (logo churn) and revenue churn (dollar churn). Monthly churn of 2% compounds to roughly 22% annually, illustrating why even small churn rates demand attention. Churn rate varies significantly by segment -- SMB products often see 3-5% monthly churn while enterprise products target below 10% annual churn. Analyzing churn by cohort, segment, and reason helps identify systemic issues and prioritize retention investments.
What are the best Churn Rate tools?
Top tools related to Churn Rate: Tinybird, Hightouch, Mixpanel, Amplitude, ChartMogul.