Churn Rate Calculator
Measure the percentage of customers who cancel their subscriptions.
Your Customer Churn Rate
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Understanding Customer Churn
What is Churn Rate?
Customer Churn Rate is the percentage of subscribers to a service who discontinue their subscription within a given time period. For a business to expand its client base, its growth rate (measured by the number of new customers) must exceed its churn rate. A high churn rate can severely damage a company’s profitability and hinder its growth.
Why is Churn a Critical SaaS Metric?
- Impacts Revenue: Churn directly reduces your Monthly Recurring Revenue (MRR) and your Customer Lifetime Value (LTV).
- Increases Acquisition Costs: It’s almost always more expensive to acquire a new customer than it is to retain an existing one. High churn forces you to spend more on marketing and sales to simply replace lost customers.
- Indicates Product/Service Issues: A rising churn rate is often a leading indicator of customer dissatisfaction with your product, service, or pricing.
How to Reduce Your Churn Rate
- Improve Your Onboarding: Ensure new customers understand how to get the most value from your product as quickly as possible.
- Engage with Proactive Support: Reach out to customers who show signs of disengagement before they decide to cancel.
- Gather Feedback: Actively solicit feedback from customers (especially those who churn) to understand their pain points.
- Offer Incentives: Provide loyalty discounts or exclusive features for long-term customers.