Churn Rate / Marketing Terms Churn Rate Churn rate is a metric that measures the percentage of customers or subscribers who stop doing business with an organisation over a specific period. It is commonly used in subscription-based models, such as SaaS platforms, membership programs and donor-supported nonprofits. A high churn rate indicates that users are leaving quickly, while a low churn rate suggests strong retention and long-term engagement. Churn rate is calculated by dividing the number of customers lost during a period by the total number of customers at the start of that period, then multiplying by 100. For example, if a company starts the month with 1,000 customers and loses 50, the monthly churn rate is 5 percent. Churn can be voluntary (when users choose to cancel) or involuntary (due to payment failures or inactivity). Some organisations also track revenue churn, which measures lost recurring revenue from downgraded or cancelled accounts. Reducing churn is critical for sustainable growth. Acquiring new customers often costs more than retaining existing ones, so even small improvements in retention can significantly impact revenue. Common strategies to reduce churn include improving onboarding, offering tiered pricing, gathering user feedback, providing proactive support and ensuring consistent value delivery. For nonprofits, keeping donors engaged through regular impact updates and transparent reporting can help reduce attrition. Tracking churn rate alongside engagement and customer satisfaction scores gives a clearer picture of overall health. Understanding why users leave allows teams to improve their offering, boost loyalty and drive long-term success.