Churn Rate

Definition of Churn Rate

The percentage of customers who stop using a product or service over a given period.

Explanation of Churn Rate

Churn Rate refers to the percentage of customers who stop using a product or service within a specific period. It is a key metric for subscription-based businesses, indicating customer retention and satisfaction. A high churn rate suggests that a significant number of customers are leaving, which can impact revenue and growth. Businesses monitor churn rate to identify issues and implement strategies to retain customers. Reducing churn rate involves improving customer experience, addressing pain points, and offering incentives for continued use. Regularly engaging with customers, providing excellent support, and delivering consistent value can help minimize churn. Analyzing churn rate helps businesses understand customer behavior and make data-driven decisions to enhance retention efforts. By focusing on reducing churn, companies can increase customer lifetime value, build loyalty, and achieve sustainable growth. Churn rate is a critical indicator of business health and should be closely monitored and managed.

This dictionary entry was written by

Per-Gulbrand Peter Braathen

With a foundation in doctoral-level research, Per-Gulbrand Peter Braathen is a seasoned expert in the areas of marketing, branding and communication. His proficiency extends to marketing management, branding and communication strategy. Braathen's experience is underscored by his rich background from various industries, including entertainment. A distinguished alumnus of the USC Marshall School of Business, Braathen boasts a Master of Science in Marketing, complemented by a Graduate Certificate in the Business of Entertainment from the USC School of Cinematic Arts as well as two undergraduate Bachelor degrees from the esteemed University of Southern California.