What is Churn?
Churn rate measures customer attrition—how many customers you lose over time. It’s a critical metric for subscription businesses.
Types of Churn
Customer Churn
Percentage of customers lost: Customer Churn = (Lost Customers / Start Customers) × 100
Revenue Churn
Percentage of revenue lost: Revenue Churn = (Lost MRR / Start MRR) × 100
Negative Churn
When expansion revenue exceeds churned revenue—the holy grail of SaaS.
Benchmark Churn Rates
- Enterprise SaaS: < 5% annually
- SMB SaaS: 3-5% monthly
- Consumer subscriptions: 5-7% monthly
Reducing Churn
- Improve onboarding
- Provide excellent support
- Regular customer success touchpoints
- Product improvements
- Win-back campaigns
- Understand why customers leave