Customer churn rate and supporting figures
Losses count only customers in the opening cohort. Projection applies the same loss proportion in each repeated period without adding new customers; it is an assumption-based scenario, not a forecast.
For a separate monetary return calculation on an investment in customer retention, use the ROI Calculator with actual costs and proceeds.
The formula
Losses count only customers in the opening cohort. Projection applies the same loss proportion in each repeated period without adding new customers; it is an assumption-based scenario, not a forecast.
Worked churn rate example
Losing 50 customers from an opening cohort of 1,000 gives 5% churn and 950 retained customers. Repeating 5% churn for twelve periods leaves 54.04% of a modeled opening cohort.
How to use this calculator
- Enter customers at period start, starting-cohort customers lost.
- Set repeated periods to project using the stated units or choices.
- Calculate and compare customer churn rate, starting customers retained, projected repeated-period retention.
Choosing inputs for churn rate
Choose a defined reporting interval and a consistent event for customer loss. Cancellation, expiration, and failed payment can be counted differently in billing systems. Keep the definition unchanged when comparing periods, and make sure the loss count refers to the customers who were present at the beginning.
New customers acquired during the interval do not reduce the measured loss from the opening cohort. A business can grow overall while losing a large share of existing customers. Entering all cancellations, including customers who joined and left within the same interval, would change the cohort definition used by this calculator.
Interpreting customer churn rate
Repeated-period retention compounds the retained proportion instead of multiplying the churn percentage by the number of periods. If the interval is a month, twelve periods can describe a year-long constant-churn scenario. For quarterly inputs, twelve periods represent three years. Actual cohorts often change behavior over time, so the projection should be interpreted separately from observed churn.
Assumptions & limitations
What this calculation assumes
- Customer counts and period counts are whole numbers.
- Losses are a subset of the opening cohort and projected churn stays constant.
What to keep in mind
- Revenue churn, reactivations, new-customer churn, and varying future loss rates are excluded.
Common questions
Why not multiply monthly churn by twelve?
Each month’s loss applies to the remaining customers, so repeated-period retention compounds.
Should I subtract new signups?
No. This measures loss from the original cohort; new acquisitions do not undo those losses.
Can I use quarterly inputs?
Yes. The observed rate is for your chosen interval, and projected periods repeat that same interval rather than assuming months.
Sources & further reading
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