What Is Churn Rate?

Churn rate, also known as customer churn or attrition rate, shows the percentage of customers or subscribers who decide to stop interacting with a business, either by canceling their subscriptions or not renewing their contracts.

Churn rate is an important metric, especially for companies whose clients make recurrent payments.

In order to determine your company’s churn rate, you will need the following information:

For example, let’s say that your company acquired 700 customers between January and April. During the same time period, 70 customers were lost due to contract expiration.

In this particular case, the churn rate takes the following value: 70/700 x 100 = 0.1 x 100 = 10%.