Customer churn rate

Discover how Customer Churn Rate measures the percentage of customers who stop doing business with a company over a given period. Learn how to track, analyze, and optimize churn rate to improve customer retention.

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KPI Details for Customer churn rate

Category	Marketing
Type	Lagging Indicator
Calculation	Churn Rate (%) = (Customers Lost During Period / Average Customers During Period) × 100
Measure	Tracks the percentage of customers who stop using a product or service, helping businesses assess retention and loyalty.
Data Sources:	Salesforce, HubSpot, ProfitWell, Stripe, Chargebee, Google Analytics, Recurly.
Frequency	Tracked monthly or quarterly to monitor customer retention trends and refine engagement strategies.

Example target

Reduce customer churn rate by 10% in Q3 by improving customer support, enhancing onboarding experiences, and offering loyalty incentives.

Example Reports Use Case

A Customer Success Manager tracks churn rate to identify patterns in customer attrition. If churn increases, they may introduce proactive engagement strategies, gather customer feedback, or adjust pricing structures.

KPI Example

Best Practices for Customer churn rate

Improve Onboarding & Customer Support

Ensure customers receive the guidance they need to maximize product value.
Implement Customer Feedback Loops

Use surveys and direct outreach to understand why customers leave and address issues.
Offer Loyalty & Incentive Programs

Encourage long-term engagement with discounts, rewards, and exclusive offers.
Monitor Usage & Engagement Trends

Identify at-risk customers early and take action to re-engage them.

What is Customer Churn Rate

Customer Churn Rate is a key performance indicator (KPI) that measures the percentage of customers who end their relationship with a business over a given period of time. In subscription-based businesses like SaaS or mobile apps, churn occurs when customers cancel or fail to renew their subscriptions; in eCommerce, it often refers to customers who do not make a repeat purchase within a set time frame, such as 90 or 120 days. Churn rate is critical because retaining existing customers is typically more cost-effective than acquiring new ones, and lost customers can represent significant missed future revenue. Monitoring churn helps identify issues in customer satisfaction, service quality, or product offerings, enabling businesses to take corrective action to improve retention.

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