What is a good customer churn rate ?

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Companies should aim for the lowest possible turnover rate, although 0% turnover is unrealistic.

To make an objective decision regarding the ideal turnover rate for your company, follow these two steps:

Compare your current churn rate to the industry average. Knowing your industry's average churn rate can help you gauge your company's performance against your competitors.

Compare your current turnover rate with your previous attrition rates. Once you have a personal benchmark to work with, you'll know if retention is improving over time.

Comparing turnover rates with those of your competitors can be challenging. For starters, turnover rates vary across and within industries. Companies don't like to share their losses and can be closed books, so it's difficult to estimate a realistic average turnover rate.

Business intelligence firm Recurly surveyed 1,900 companies across all sectors. These are the average attrition rates reported for six popular industries:

SaaS: 4.75%

Digital media and entertainment: 6.42%

Education: 7.22%

Consumer goods and retail: 7.55%

Business and professional services: 6.59%

Health: 6.03%

If your churn rate is significantly higher, say 20-30%, you should gambling data china figure out why (we'll explain how in a moment).

Ideally, you should establish your benchmarks and work to reduce them, as a small reduction in your churn rate can lead to a significant change in revenue. The more customers you have, the greater this effect will be.

Recommended reading

Sales Funnel: The Ultimate Guide

How to calculate the customer churn rate ?
To calculate your customer churn rate, you need to choose a particular time period and then determine the percentage of customers who left your business during that time.