Churn Rate
Quick definition
The percentage of customers who stop using your product or service within a specific period.
Detailed explanation
Churn rate is one of the most important metrics for any subscription or SaaS business. It measures how many customers you lose, and has a direct impact on your growth and profitability. A churn rate of 5% per month means you lose 60% of your customers each year - requiring you to acquire 60% new customers just to stay flat. There are different types of churn: customer churn (number of customers), revenue churn (value), and net churn (including expansion). High churn usually points to product-market fit problems, poor onboarding, lack of customer success, or wrong target customers. It's always cheaper to retain existing customers than acquire new ones, so churn reduction must be a top priority.
Synonyms
Examples
A SaaS company starts Q1 with 1000 customers, loses 50 customers, and ends with 950 customers → Monthly churn rate: 5%. At this rate you only retain 40% of customers after 12 months.
By implementing better onboarding and proactive customer success, churn drops from 5% to 2% per month. This means LTV nearly doubles and the company grows toward profitability.
When to use this?
Measure churn monthly and quarterly. Analyze why customers leave through exit interviews. Segment churn by customer type, acquisition channel, and product usage to find patterns. Focus on reducing early-stage churn (first 90 days).
Match-day approach
Match-day helps you reduce churn by setting up a customer success program. We identify early warning signals in product usage data, implement health scores in your CRM, and train your team in proactive outreach. We analyze why customers leave and build playbooks to proactively address these reasons. Often we discover that churn starts with wrong expectations during the sales phase - so we also optimize your sales process for long-term fit.
Learn more
Wil je weten hoe je churn rate effectief inzet in jouw organisatie? Neem contact op met Match-day.
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