Churn Rate
The percentage of customers (or revenue) lost during a period, typically measured monthly or annually.
“How much of our customer base or revenue are we losing?”
The rate at which the business is losing customers or revenue, a core retention health signal.
Whether losses are concentrated in low-value accounts or critical ones — always pair logo churn with revenue/GRR to see the full picture.
Numerator
Customers Lost in Period
Denominator
Customers at Start of Period
Example
Start the month with 1,200 customers; 30 churn. Churn Rate = 30 / 1,200 = 2.5%.
Recommended visualization: Trend line with logo churn vs. revenue churn overlay
Clearly distinguish 'logo churn' (customer count) from 'revenue churn' (dollar-weighted) — reporting only one hides whether big or small accounts are leaving.
- Confirm downgrades are categorized separately from full churn unless the org has explicitly defined downgrade-as-churn
- Exclude planned contract non-renewals due to M&A or shutdown from 'controllable' churn reporting
- Reporting only logo churn while revenue churn tells a very different (often worse) story, or vice versa
- Not capturing a structured churn reason at cancellation, making the metric impossible to act on
Get a conversational, stakeholder-friendly explanation of this KPI, generated on demand.