Your customer churn rate is an indication of how your company is handling customer retention. As mentioned earlier, there are always customers who jump ship for a number of reasons. A few of the most common are outlined below:
Change in financial status
Change in geography or living situation
Loss of interest in the product (or brand overall)
Loss of interest in the brand overall
Change in life status (i.e., a young family “outgrowing” a brand like Pampers as children age)
There are two formulas here you should pay attention to:
Customer churn rate. This gives a snapshot of how your company is doing in customer retention. For example, if you’re calculating the customer churn rate for Q2, the formula is:
Number of Customers Lost During Q2 ÷ Total Number of Customers at Start of Q2 = Customer Churn Rate.
Revenue churn rate. Knowing the financial impact of churn is vitally important, so you need a formula that calculates it. The revenue churn rate measures the impact of customer churn. Using our Q2 example, the formula is
Total of Recurring Revenue Lost in Q2 ÷ Original Total email data of Recurring for Q2 = Revenue Churn Rate.
Of course, you can make all sorts of calculations from churn, including whether the customers lost were ones who were worth focusing on, and if so, what can be changed to retain those types.
What All This Means
These numbers and metrics are designed to give you insight into treatment human immunodeficiency many of the key aspects of the sales and marketing business: how successful the sales team is in landing new business, how the marketing department is handling pricing, how customer service is agent email list working with retaining customers and, in the big picture, and how current and potential customers perceive your company and its offerings overall.