Marketing, sales and customers
Churn
Customers who stop buying from or using a business over a period.
- Marketing, sales and customers
Definition
Customers who stop buying from or using a business over a period. The churn rate is the share of customers at the start of the period who are lost by the end.
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Why it matters
Keeping customers is usually cheaper than winning new ones, so churn shows whether growth is building on a solid base.
Where it is used
Subscription dashboards, retention plans and board reports. Used by customer success managers, marketing analysts, account managers and finance.
How to calculate it
Churn rate % = customers lost in period ÷ customers at start of period × 100
Worked example
Raket Parts B.V. had 402 customers who ordered in January to March 2025. All 402 ordered again between April and September, so churn on a six-month no-order rule was 0 / 402 = 0%.
ILLUSTRATION of the steps when customers are lost: if 20 of the 402 had placed no order in the six months, churn would be 20 / 402 x 100 = 5.0%.
Raket Parts B.V. is a fictional company created for Insyt.
Definitions vary. For subscriptions a customer is lost on cancellation; for repeat buyers, after a chosen period without orders, such as 90 days or six months. Some measure churn in revenue rather than customers. Check how your organisation calculates it.