Whether you’re retaining the customers you acquire
Posted: Sun Feb 02, 2025 10:04 am
Customer churn rate = (Customers lost during time period / Total number of customers at the start) * 100
Example: If you had 3,000 customers at the start of the month and lost 150 during the month, that equates to a monthly churn rate of 5 percent.
Customer churn rate formula by Close
If you want to see this in terms of the financial impact, use this revenue churn rate formula:
Revenue churn rate = (Revenue lost during time period / Total revenue at the start) * 100
Example: If you had $50,000 MRR at the beginning of the month and $47,350 at the end, you’d have lost $2,650 in monthly recurring revenue. That equates to a 5.3 percent monthly churn rate.
Revenue churn rate formula by Close.
On the other hand, negative churn refers to acquiring more customers than you lose. If you lose 50 customers but acquire 78 new ones over the same period, income from the new customers will replace the revenue lost through churn.
Churn rate is a prevalent SaaS metric; subscription businesses rely on it to guide customer retention strategies. However, this KPI is useful across many industries, so keep reading.
Why Churn Analysis is Essential to Tracking Business Growth
Tracking churn is key to building better sri lanka telegram data customer retention. So, if you’re wondering if it’s worth it, just remember: increasing customer retention rates by just five percent increases profits by 25 to 95 percent.
When you do regular churn analysis and track your annual churn rate, you’ll see:
The level of customer satisfaction and loyalty
If your customer acquisition costs would be better spent on helping existing customers stay on
Whether your current growth will be sustainable in the long term
Of course, you don’t track churn in a vacuum—watch this essential sales KPI alongside others, including your revenue growth rate, customer acquisition costs (CAC), MRR and ARR, and customer lifetime value. That way, you’ll have a full picture of your sales health and customer base.
Remember: churn compounds over time. What might sound like a low percentage of cancellations can ultimately cost your business thousands of dollars each year?
Churn Rate Benchmarks: How Does Your Company Compare?
Do you have a good churn rate—one that’s on par with the competition or in your industry?
Example: If you had 3,000 customers at the start of the month and lost 150 during the month, that equates to a monthly churn rate of 5 percent.
Customer churn rate formula by Close
If you want to see this in terms of the financial impact, use this revenue churn rate formula:
Revenue churn rate = (Revenue lost during time period / Total revenue at the start) * 100
Example: If you had $50,000 MRR at the beginning of the month and $47,350 at the end, you’d have lost $2,650 in monthly recurring revenue. That equates to a 5.3 percent monthly churn rate.
Revenue churn rate formula by Close.
On the other hand, negative churn refers to acquiring more customers than you lose. If you lose 50 customers but acquire 78 new ones over the same period, income from the new customers will replace the revenue lost through churn.
Churn rate is a prevalent SaaS metric; subscription businesses rely on it to guide customer retention strategies. However, this KPI is useful across many industries, so keep reading.
Why Churn Analysis is Essential to Tracking Business Growth
Tracking churn is key to building better sri lanka telegram data customer retention. So, if you’re wondering if it’s worth it, just remember: increasing customer retention rates by just five percent increases profits by 25 to 95 percent.
When you do regular churn analysis and track your annual churn rate, you’ll see:
The level of customer satisfaction and loyalty
If your customer acquisition costs would be better spent on helping existing customers stay on
Whether your current growth will be sustainable in the long term
Of course, you don’t track churn in a vacuum—watch this essential sales KPI alongside others, including your revenue growth rate, customer acquisition costs (CAC), MRR and ARR, and customer lifetime value. That way, you’ll have a full picture of your sales health and customer base.
Remember: churn compounds over time. What might sound like a low percentage of cancellations can ultimately cost your business thousands of dollars each year?
Churn Rate Benchmarks: How Does Your Company Compare?
Do you have a good churn rate—one that’s on par with the competition or in your industry?