What is churn rate?

Churn rate is the share of your users who stopped coming back.

Look at everyone who used your product last month, then check how many of them used it again this month. The ones who didn't are your churn. If 100 people used it last month and 35 never came back, your churn rate is 35%.

New users come in at the top and churned users leave at the bottom. Whether you're actually growing is the difference between the two.

Why it is the number founders fear

Churn compounds quietly.

At 10% monthly churn, the average user stays about ten months. At 40%, they stay under three. The same marketing spend buys you a quarter as much, and signing up more people won't fix it — you're filling a leaking bucket faster instead of patching the hole.

It's also slow to show up. People who churn this month usually gave up weeks ago, in a first session that went nowhere. By the time the number moves, the cause is old news.

What good looks like

Meterio uses a churn threshold to decide whether your product has found its habit yet. Above it, you stay in the stickiness stage no matter how fast you're growing.

| Product category | Churn above this holds you back | |------------------|--------------------------------| | SaaS | 30% | | AI tool | 40% | | Marketplace | 35% | | Community | 35% | | Content | 40% |

The thresholds differ because the expected rhythm differs. A tool people open daily should lose few of them in a month. A content product people dip into is allowed a looser number.

Two things to keep in mind. Early churn is dominated by people who were never a good fit, so it usually starts high and falls as you get clearer about who the product is for. And with under about fifty users, one person leaving moves the number by two points, so read the direction over several weeks rather than any single reading.

How to reduce it

Look at the first session, not the last one. Most churn is decided before the user ever forms an opinion worth losing, so the fix usually lives in the first ten minutes.

Find the action that separates people who stay from people who leave. Compare the two groups on what they did in week one, then make the winning action harder to miss.

Give people a reason to return that doesn't depend on them remembering. A weekly summary, a notification tied to something they care about, anything that reopens the loop.

Talk to five people who stopped. It is the fastest research you can do, and the answer is rarely the one you expected. Repeat rate will show you the same problem sooner, because it moves within a single period instead of waiting for two.