What is Churn rate?
Churn rate refers to the percentage of customers who stop using a company's product or service during a certain period of time. It's an important metric for businesses to track because it can directly impact their revenue and growth.
There are many reasons why customers may churn, including poor customer service, high prices, lack of features or benefits, or simply finding a better alternative. By monitoring churn rate, companies can identify areas for improvement and take action to retain more customers.
To calculate churn rate, divide the number of customers lost during a specific period by the total number of customers at the beginning of that same period. For example, if a company had 1000 customers at the start of the month and lost 50 by the end of the month, its monthly churn rate would be 5%.