Churn
Churn is the share of customers who stop buying or cancel their subscription in a given period.
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What does Churn mean?
For a subscription business monthly churn is one of the key numbers: winning a new customer usually takes more work than keeping an existing one.
Early signs of churn can be fewer purchases, unanswered complaints or poor satisfaction answers.
Churn is simple to work out: of the customers you had at the start of the period, how many cancelled or stopped buying by its end, divided by the number at the start. For a business without subscriptions, a customer usually counts as churned when they stay away well beyond their usual buying rhythm; the company has to draw that line itself.
Why does it matter to a small business?
In a small business a handful of returning customers can bring in much of the revenue, so a customer leaving is felt more than in a large company. When churn is visible, you can call the customer who has gone quiet in time, ask what went wrong and fix it before others leave for the same reason.
What does it look like in practice?
Details
Suppose a coffee roaster in Szeged sells a monthly coffee subscription. In January it has a hundred subscribers, and five cancel during the month (the numbers are only illustrative), so monthly churn is five percent. The roaster asks those who cancelled why; two say it is too much coffee, so it introduces a smaller package.
How does HelloCRM handle it?
Details
In HelloCRM the Subscriptions module handles recurring fees, while Surveys and the Helpdesk help spot an unhappy customer in time.
Module: Subscriptions (paid module, price coming soon).
A CRM for small businesses in Hungary
HelloCRM is an online CRM made in Hungary for small and mid-sized businesses there, in Hungarian and English: the core CRM is free for good, with no time limit and no card, and it can be tried without signing up in a demo company full of example data.
Questions
What is Churn, in one sentence?
Churn is the share of customers who stop buying or cancel their subscription in a given period.