What is churn rate?
The percentage of customers who stop using your product during a given time period. It's the opposite of retention rate. If your churn rate is 5% monthly, you lose 5 out of every 100 customers each month.
Formula
Churn Rate = (Customers Lost / Customers at Start) × 100
Why it matters
Churn is the silent killer of growth. Even excellent acquisition can't outrun high churn. A 5% improvement in retention can increase profits 25-95%. Every churned customer is wasted acquisition cost.
How to improve
Focus on activation first (users who activate rarely churn). Build habit loops. Add switching costs (data, integrations). Solve the "why" of churn through exit surveys. Bundle value to create multiple reasons to stay.
Related playbooks
Add a streak counter
People hate losing things more than they like gaining them. A streak counter turns that into a reason to come back every day.
Bundle more value into the subscription
Add things to your subscription so canceling means losing multiple things they use.
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