What is Churn Rate?

Churn rate is the percentage of customers (or revenue) you lose over a period. It's the inverse of retention and one of the most important health metrics for any subscription business — small differences in churn compound dramatically over time, so even a point or two matters.

Customer churn vs revenue churn

Customer churn counts how many customers you lost; revenue churn counts how much recurring revenue you lost. They can diverge — losing many small accounts but few big ones looks very different in each. Track both, since a low customer churn can still hide painful revenue churn if your larger accounts are the ones leaving.

How support reduces churn

Support is a frontline retention lever. Fast, low-effort help keeps frustrated customers from leaving, and proactive outreach catches at-risk accounts before they cancel. The same questions that go unanswered become cancellation reasons — so deflecting and resolving them quickly directly protects retention.

Formula

Customer churn rate % = (Customers lost in period ÷ Customers at start) × 100

Example: Losing 30 of 600 customers in a month gives a churn rate of 30 ÷ 600 × 100 = 5%.

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Questions about Churn Rate

What's a good churn rate?

It depends on your segment — SMB SaaS often sees higher monthly churn than enterprise. As a rough guide, low single-digit monthly churn (or sub-10% annual logo churn) is healthy for many subscription businesses.

What's the difference between churn and retention rate?

They're two sides of one coin: retention rate is the percentage of customers you keep, churn rate the percentage you lose. They sum to 100% over the same period and population.

Related terms

Customer Retention Rate

Customer retention rate (CRR) is the percentage of existing customers you keep over a period, excluding any new ones you acquired. It's the inverse of churn and a direct measure of how well you hold onto the customers you already have — usually far cheaper than winning new ones.

Customer Lifetime Value (CLV)

Customer Lifetime Value (CLV, also written LTV) is the total revenue you can expect from a single customer over the entire relationship. It reframes customers as long-term assets rather than one-time sales — and it's the number that tells you how much you can afford to spend acquiring and supporting them.

Net Revenue Retention (NRR)

Net Revenue Retention (NRR) is the percentage of recurring revenue you retain from existing customers over a period, including expansion (upgrades) and net of contraction and churn. An NRR above 100% means your existing customers grow your revenue even before you add a single new one.

Browse the full customer support glossary →