Churn
The churn or churn rate is the percentage of customers who stop doing business or subscribing to a company or service in a set time. For example, a company like Netflix may experience a higher churn rate if they don't release enough new content or raise prices.
As a viewer of TV and movie streaming services, it's a good idea to subscribe only to one or two of the services at a time. It's cheaper to unsubscribe from one service after watching its content than to subscribe to them all at the same time.
How to determine a companies churn rate
As a business, knowing your companies churn rate helps identify if your service is underperforming and let you know where improvements may need to be made. To determine a companies churn rate, divide the lost customers by the number of customers at the start of a period (e.g., month, quarter, or year) and then times it by 100. For example, if you had 1,000 customers at the start of the month and that number decreased to 934 (loss of 66 customers), your company has a turn rate of 6.6%, as shown in the below formula
(66/1000) * 100 = 6.6%
What is a serial churner?
A serial churner describes an individual who has canceled three or more services recently. This term has become popularized as more streaming services become available and users are forced to switch between these services because of financial and time constraints.
Serial churner was also featured as a top term in 2023.
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