Churn Rate Calculator [2025]

What is Churn Rate?

Churn rate is a key metric for subscription-based businesses that measures the percentage of customers or revenue lost over a specific period. It's a vital indicator of customer retention and satisfaction.

Customer Churn vs. Revenue Churn

• Customer Churn: Measures the percentage of customers lost during a period.
• Revenue Churn: Measures the percentage of revenue lost due to churned customers or subscription downgrades.

Why is Churn Rate Important?

• Indicates Customer Satisfaction: High churn rates suggest dissatisfaction or issues with your product or service.
• Impacts Revenue: Churn directly affects your recurring revenue and long-term financial health.
• Guides Business Strategy: Understanding churn helps you make informed decisions to improve customer retention and business growth.

What is a good churn rate?

A "good" churn rate varies by industry and business model. Generally, for SaaS companies, an annual churn rate of 2-8% is considered acceptable. Lower is always better.

How can I reduce churn?

• Improve onboarding and customer training.
• Proactively seek and address customer feedback.
• Enhance product features and user experience.
• Offer incentives for customer loyalty.
• Invest in customer success and support.

Should I calculate churn monthly or annually?

Both have their merits. Monthly churn rates help you track short-term trends and react quickly to issues. Annual churn rates provide a broader picture of customer retention over the long term.