Churn rate
Churn rate is the share of customers, or of revenue, lost in a period. Customer churn counts people; revenue churn weights them by value. The two diverge whenever the customers leaving are systematically larger or smaller than average.
How it is calculated
Churn rate = Customers lost in period / Customers at start of period
State the window and whether it is customer or revenue churn. Undefined churn rates are not comparable across teams.
Why it matters for ARPU
Churn is the largest single drag on ARPU in most large B2C bases, and it is the input with the most leverage in any lifetime-value model.
Related terms
Voluntary vs involuntary churnVoluntary churn is a customer deciding to leave.Churn predictionChurn prediction estimates the probability that a given customer will stop paying within a defined horizon, using behavioural, transactional and service signals.Retention curveA retention curve plots the share of a cohort still active against time since acquisition.Gross revenue retentionGross revenue retention measures how much starting cohort revenue survives a period counting only losses: churn and downgrades, never expansion.