Customer Analytics

Churn Rate

The percentage of customers who stop purchasing over a given period. The opposite of retention rate.

Formula

Churn Rate (%) = (Customers Lost in Period / Customers at Start of Period) × 100

What is Churn Rate?

Churn rate measures the percentage of customers who stop buying from you during a specific time period. For subscription businesses, it's customers who cancel. For e-commerce, it's customers who don't return within an expected timeframe.

Churn Rate vs. Retention Rate

Churn Rate + Retention Rate = 100%. If your retention rate is 75%, your churn rate is 25%.

Reducing Churn

Post-purchase email sequences
Loyalty and rewards programs
Win-back campaigns for lapsed customers
Improve product quality and customer experience

Example

Started the quarter with 500 active customers. 75 didn't return. Churn rate = 15%.

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