{"id":7980,"date":"2026-10-24T13:31:53","date_gmt":"2026-10-24T06:31:53","guid":{"rendered":"https:\/\/adtek.agency\/glossary\/churn-rate\/"},"modified":"2026-10-24T13:31:53","modified_gmt":"2026-10-24T06:31:53","slug":"churn-rate","status":"publish","type":"mona_glossary","link":"https:\/\/adtek.agency\/en\/glossary\/churn-rate\/","title":{"rendered":"Churn rate"},"content":{"rendered":"<p>Churn rate is the percentage of customers or subscribers who stop buying, cancel or stop using a product during a period, out of those you had at the start of it. Measured on the same group of customers over the same period, churn rate equals 100% minus retention rate.<\/p>\n<h2>What is churn rate?<\/h2>\n<p>What counts as leaving has to be defined first, because it differs by business model:<\/p>\n<ul>\n<li>Subscriptions (paid apps, software, gym plans): the customer cancels or does not renew. Stripe treats a subscriber as churned when all of their subscriptions are canceled or marked as unpaid.<\/li>\n<li>Ecommerce and retail: there is no cancel button, so the business sets its own threshold, for example no purchase in 180 days.<\/li>\n<li>Free apps: GA4 has a churn probability metric, the probability that a user who was active in the last 7 days will not be active in the next 7 days (<a href=\"https:\/\/support.google.com\/analytics\/answer\/9846734?hl=en\" target=\"_blank\" rel=\"nofollow noopener\">Google Analytics Help, Predictive metrics, accessed October 2026<\/a>).<\/li>\n<\/ul>\n<h2>Churn rate formula<\/h2>\n<p><strong>Churn rate = Customers lost during the period \/ Customers at the start of the period \u00d7 100%<\/strong><\/p>\n<p>Stripe uses a variant for subscriptions: subscribers churned in the past 30 days divided by active subscribers 30 days ago plus new subscribers in those 30 days. Stripe&#8217;s example: 1,000 subscribers at the start of the month, 100 added and 100 churned during the month, so churn is 100 \/ 1,100 = 9.1% (<a href=\"https:\/\/docs.stripe.com\/billing\/subscriptions\/analytics\" target=\"_blank\" rel=\"nofollow noopener\">Stripe Docs, Billing analytics, accessed October 2026<\/a>). The basic formula above gives 10% on the same numbers. When you compare figures, ask which denominator the other side used.<\/p>\n<h2>Churn rate vs retention rate<\/h2>\n<p><a href=\"\/en\/glossary\/retention-rate\/\">Retention rate<\/a> measures the share of customers who stay; churn rate measures the share who leave. For the same cohort and period, the two add up to 100%: 90% monthly retention means 10% monthly churn.<\/p>\n<p>Over several periods you cannot multiply one month&#8217;s churn by the number of months. Stripe&#8217;s illustration: at 10% churn a month, what remains is 90% after month 1, 81% after month 2, 73% after month 3 and 59% after month 5. You lose 41% over 5 months, not 50%, because each month you lose 10% of what is left.<\/p>\n<h2>Example: churn and lifetime value (hypothetical)<\/h2>\n<p>An English learning app sells a single plan at VND 199,000 a month. On October 1 it has 5,000 subscribers, and 400 cancel during the month.<\/p>\n<ul>\n<li>October churn rate = 400 \/ 5,000 = 8%.<\/li>\n<li>Recurring revenue lost = 400 \u00d7 199,000 = VND 79.6 million a month.<\/li>\n<li>Stripe estimates subscriber lifetime value as average revenue per user (ARPU) divided by churn rate: 199,000 \/ 8% = about VND 2.49 million.<\/li>\n<\/ul>\n<p>Cut churn to 6% and <a href=\"\/en\/glossary\/lifetime-value-ltv\/\">lifetime value (LTV)<\/a> rises to about VND 3.32 million. At the same <a href=\"\/en\/glossary\/customer-acquisition-cost-cac\/\">customer acquisition cost (CAC)<\/a>, each subscriber brings in about VND 830,000 more before operating costs.<\/p>\n<h2>Where to start reducing churn<\/h2>\n<p>Separate voluntary churn (the customer clicks cancel) from involuntary churn (expired card, failed payment). Stripe&#8217;s Smart Retries automatically retry failed payments to prevent this second kind (<a href=\"https:\/\/docs.stripe.com\/billing\/revenue-recovery\" target=\"_blank\" rel=\"nofollow noopener\">Stripe Docs, Revenue recovery, accessed October 2026<\/a>).<\/p>\n<p>Break churn down by acquisition source, plan and sign-up month with <a href=\"\/en\/glossary\/customer-segmentation\/\">customer segmentation<\/a>. An ad channel that brings cheap customers with high churn can cost more than a channel with a higher CAC.<\/p>\n<p>Measure revenue too. Stripe calculates churned revenue as the recurring revenue of customers who canceled plus the drop from customers who downgraded. Losing 10 customers on a small plan is very different from losing 10 on a large one.<\/p>\n<h2>Frequently asked questions<\/h2>\n<h3>What is a high churn rate?<\/h3>\n<p>There is no universal threshold. A monthly plan gives customers 12 chances a year to cancel; an annual plan gives them 1. Comparing your own churn month over month, by customer group, is more useful than a number from the internet.<\/p>\n<h3>How do you calculate churn for an online shop without subscriptions?<\/h3>\n<p>Set a no-purchase threshold based on your real buying cycle: perhaps 90 days for fast-moving consumer goods, 1 to 2 years for furniture. Customers past the threshold count as churned.<\/p>\n<h3>Does a loyalty program reduce churn?<\/h3>\n<p>It can, but you need a control group to measure it. See <a href=\"\/en\/glossary\/loyalty-program\/\">loyalty program<\/a>.<\/p>\n<p>If you need to connect churn data with ad spend to see which channels bring customers who stay, <a href=\"\/en\/contact\/\">contact Adtek<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Churn rate is the percentage of customers or subscribers who stop buying, cancel or stop using a product during a period, out of those you had at the start of it. Measured on the same group of customers over the same period, churn rate equals 100% minus retention rate. What is churn rate? What counts [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"closed","template":"","meta":{"_acf_changed":false,"_yoast_wpseo_title":"Churn Rate: What It Is, Formula and Churn vs Retention","_yoast_wpseo_metadesc":"What is churn rate? The share of customers who leave in a period. 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