Formula
Churn rate = Customers lost ÷ Starting customers × 100Customer churn formula
Divide customers lost during the period by customers active at the beginning. Losing 80 of 2,000 starting customers produces 4% customer churn.
Customer versus revenue churn
Customer churn weights every customer equally. Revenue churn reflects the value lost and may be more informative when account sizes vary. State which measure you use.
Period length matters
Monthly and annual churn percentages are not directly interchangeable. Preserve the observation period whenever reporting or benchmarking churn.
Assumptions
- Lost and starting customer definitions are consistent.
Sources and methodology
CalcMotive publishes the formula and assumptions so you can decide whether the estimate fits your use case. See our methodology standards.