What is Churn Rate?
Churn rate measures the percentage of users who stop using your app within a specific time period. It's the inverse of retention: if D7 retention is 20%, D7 churn is 80%. Understanding and reducing churn is essential for sustainable growth.
Churn Rate Formula
Why Churn Matters
Churn is critical because:
- High churn kills growth regardless of acquisition
- Directly reduces LTV and ROI
- Indicates product or experience problems
- Compound effect: small improvements yield big results
- Cheaper to retain than acquire new users
Types of Churn
Voluntary Churn
Users actively choose to leave—uninstalling the app or canceling subscription. Often due to poor experience, lost interest, or found alternative.
Involuntary Churn
Users churn due to external factors—payment failures, device changes, or technical issues. Often recoverable with proper intervention.
Revenue Churn
For subscription apps, revenue churn tracks lost recurring revenue, which may differ from user churn if users downgrade rather than cancel.
The Churn-Retention Relationship
Churn Rate = 100% - Retention Rate. If you have 40% D1 retention, you have 60% D1 churn. Focus on retention improvements to reduce churn automatically.
Common Churn Causes
| Churn Cause | Timing | Solution |
|---|---|---|
| Poor onboarding | D0-D1 | Simplify first experience |
| No value delivery | D1-D7 | Faster time to "aha moment" |
| Content exhaustion | D7-D30 | Regular content updates |
| Lost habit | D30+ | Engagement loops, notifications |
| Better alternative | Any time | Competitive differentiation |
Reducing Churn
- Identify at-risk users: Predict churn before it happens
- Improve onboarding: D1 churn is often highest
- Create engagement loops: Daily reasons to return
- Win-back campaigns: Re-engage churned users
- Fix technical issues: Crashes and bugs cause churn
- Collect feedback: Exit surveys reveal causes
Churn Analysis
- Cohort analysis: Track churn by acquisition cohort
- Survival analysis: Probability of churning over time
- Churn prediction: ML models to identify at-risk users
- Segment analysis: Churn rates by user type/source