Churn Rate
Also called: customer churn, attrition rate
What is Churn Rate?
Churn rate is the percentage of customers who stop buying over a period. For subscription businesses it is measurable directly; for retail and restaurants it is inferred from the absence of repeat purchases.
Why Churn Rate matters
Churn compounds quietly. Losing 5% of customers a month means replacing the entire base within two years just to stand still.
Churn Rate formula
Churn rate % = Customers lost in period ÷ Customers at start of period × 100
Retention rate is simply 100 minus churn.
How Churn Rate works in practice
Define churn against your natural purchase cycle — no purchase in ninety days means something different for a cafe than for a jeweller. Then look at what the churned cohort had in common.
Frequently asked questions
By absence of repeat visits within a defined window, which is why capturing customer identity at billing matters.