What Is Customer Churn Rate
Understand your customer churn rate to improve business health
The term “churn” describes the loss of customers who don’t resign their contract at the time of their renewal. This could mean many things—they found a different product better suited to their needs, they’re dissatisfied with their experience, your price point is too high, they’re under new management, etc.
Customer churn rate is just one of the ways to look at your company’s churn and business health. It focuses on, you guessed it, the number of customers that churn. Revenue churn rates are similar but instead, they focus on the contract amount each customer represents. These rates will differ because certain customers could have more expensive contracts than others.
For an in-depth look at how to calculate customer churn and revenue churn, check out our Essential Guide to Churn. You’ll find a wealth of equations, examples, and explanations.