Free tool
Churn rate calculator
The customers you had at the start of a period and the ones you lost in it, into the churn rate, what that rate comes to over a month and over a year, the share who stayed, and how long a customer stays if the rate holds. Nothing you type leaves your browser.
Replacing the customers who leave, from the searches people already make for what you sell, is what our SEO services are for.
What the rate comes to
- Churn rate for the period
- Share who stayed
- Monthly equivalent, by compounding
- Yearly equivalent, by compounding
- Length of a stay, if the rate never changed
- Revenue churn for the period
Type the customers you started with and the ones who left, choose the period, and the figures appear.
What the rate tells you
A churn rate is the share of one group of customers that had left by the end of a period. The group is fixed on the first day. Whoever joins afterwards belongs to the next count, which is why a business can win forty customers in a month, lose thirty and still have a churn rate that should worry it: the forty hide the thirty in the headline total and do nothing to the rate.
The rate matters to anyone paying to win customers, because every customer who leaves has to be replaced before the business has grown by one. A firm that loses a tenth of its customers each quarter spends the first part of every marketing budget getting back to where it stood.
Why the yearly figure is not twelve times the monthly one
Each month's losses come out of a smaller group than the month before. At 5 percent monthly, 95 of every hundred customers are left after one month, about 90 after two and 54 after twelve, so the year's churn is 46 percent. Twelve times five is 60, and a plan built on 60 replaces customers who never left.
The monthly and yearly figures on this page are worked that way, by compounding, from whichever period you counted over. They are arithmetic, and they assume the rate stays where it is for the whole year. If you have a year of real counts, use the year.
How long a customer stays
One divided by the rate, in the period the rate was measured over. A rate of 5 percent monthly is one divided by 0.05, which is 20 months. The same 5 percent measured over a year is 20 years. Mixing the two periods moves the answer by a factor of twelve, and it is the easiest mistake to make with this number.
It is the arithmetic of a rate that never changes, and real customers do not behave that evenly. Most businesses lose people fastest in the first weeks and keep the ones who get past them for a long time. Treat the figure as an average to plan with, and put it into the customer lifetime value calculator as the years a customer stays.
Counting it from your own records
Pick a first day and list everyone who was a paying customer on it. On the last day of the period, count how many names on that list are no longer customers. Those two numbers are the whole calculation. Use the same day each time, the first of the month or the first of the quarter, so that one period can be set beside the next.
A subscription makes "left" easy: they cancelled. A trade without contracts has to decide it. A dental practice might call a patient lost after eighteen months without a visit, a cleaning firm after two missed bookings. Write the rule down and keep it, because a rate is only worth comparing with one counted the same way.
Revenue churn is the same sum in money: the recurring revenue those customers were worth on the first day, and how much of it had gone by the last. It can differ a good deal from the customer figure. Losing three small accounts and losing one large one are the same revenue and very different businesses.
The figures on either side of this one
The length of a stay feeds the customer lifetime value calculator, which turns it into what a customer is worth. The customer acquisition cost calculator says what the replacement costs, and the break-even calculator says how many customers cover the fixed costs in the first place.
Questions about churn rate
How do you calculate churn rate?
Divide the customers you lost in a period by the customers you had on its first day, and multiply by one hundred. Both figures come from the same period, and customers won during it are left out of both: a customer who joined in the second week was never one of the people you started with. If 400 customers began the quarter and 28 of them had gone by its end, the churn rate for the quarter is 7 percent.
What does a 5 percent churn rate mean?
Of every hundred customers at the start of the period, five had left by the end of it. What that comes to depends on the period. Measured over a month, 95 of every hundred stay each month, and 0.95 multiplied by itself twelve times is 0.54, so 46 percent are gone in a year and a customer stays 20 months on average if the rate holds. Measured over a year, the same 5 percent is a stay of 20 years. Always say the period with the figure.
What does a 20 percent churn rate mean?
A fifth of the customers you started the period with had left by its end. Over a month that is severe: 0.8 multiplied by itself twelve times is 0.07, so 93 percent of a starting group is gone within a year and the average stay is five months. Over a year, 20 percent is a stay of five years, which many businesses would be glad of. The number is the same and the two businesses have nothing in common.
What is a healthy churn rate for a business?
It depends on the business, and no single figure is quoted here because none we found has a source that can be checked. What decides it is your own arithmetic: how much gross profit a customer brings over the stay the rate implies, against what a customer costs to win. A rate is healthy when the first figure is comfortably larger than the second, and the customer lifetime value calculator on this site makes that comparison from your own numbers.
Is anything I type here sent anywhere?
No. Everything happens in your browser. There is no form submission, no analytics event and no network request of any kind, which you can confirm in your browser’s network tab.
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