Customer churn is the loss of customers who stop buying from you or cancel what they pay for. It is one of the clearest signs that your product, price, or service is falling short.<\/p>\n\n\n\n
Most teams notice churn only after the revenue has gone. A better approach is to measure it cleanly, learn why people leave, and spot the warning signs early.<\/p>\n\n\n\n
In this guide, you will learn how to calculate your customer churn rate and read a churn analysis. You will also see how to predict who may leave next and reduce churn with six practical tactics.<\/p>\n\n\n\n\n\n
Customer churn is the percentage of customers who stop doing business with a company during a set period. It is also called customer attrition. A customer has churned once they cancel, let a contract lapse, or stop buying altogether.<\/p>\n\n\n\n
Churn matters because keeping customers costs far less than replacing them. Harvard Business Review reports that acquiring a new customer can cost 5 to 25 times more than retaining an existing one<\/a>. It also cites Bain & Company research showing that a 5% rise in retention can lift profits by 25% to 95%.<\/p>\n\n\n\n A customer counts as churned in different ways, depending on your model:<\/p>\n\n\n\n Several terms get used as if they mean the same thing. They do not, and mixing them up leads to wrong calculations.<\/p>\n\n\n\n\n
Customer churn vs. retention, attrition, and revenue churn<\/strong><\/h2>\n\n\n\n