Free tool
Churn Rate Calculator
One point less churn moves your customer lifespan, and therefore your acquisition budget. The tool runs all three calculations in a row.
Churn rate is the share of customers lost over a period. You get it by dividing customers lost by customers present at the start of that period. Its inverse gives average customer lifespan, which then feeds lifetime value.
The customers you lose each month
From churn to customer value
Churn rate = (Customers lost ÷ Customers at start) × 100 Lifespan = 1 ÷ Churn rate Lifetime value = Monthly revenue × Lifespan With discounting: Lifetime value = Monthly revenue × (1 + i) ÷ (i + Churn rate), where i is the monthly rate Value after margin = Lifetime value × Gross margin
48 customers lost out of 1,200 gives 4 % monthly churn. A customer therefore stays 25 months on average, and at 39 € a month is worth 975 €. At a 40 % margin, that leaves you 390 €.
The leverage is what surprises most. Moving from 4 % to 3 % churn stretches lifespan from 25 to 33 months and lifts customer value to 1,287 €, which is 32 % more. Since customer value sets the acquisition ceiling, one point of churn earned mechanically lets you bid higher than competitors on the same audiences.
⚠️ The 1 ÷ churn formula assumes a stable rate. In practice churn is always heaviest in the first months: the lifespan it returns is a useful average for steering, not a prediction for any one customer.
Two ways to count it, and they do not say the same thing
- Customer churn measures the health of the product and the relationship. That is what this tool computes.
- Revenue churn weights each departure by what it was worth. Losing 4 % of customers who carried 10 % of revenue is a different kind of problem, and a business can post negative revenue churn when remaining customers upgrade.
Frequently asked questions
How do you calculate churn rate?
Divide customers lost by customers present at the start of the period, then multiply by 100. For 48 customers lost out of 1,200: (48 ÷ 1,200) × 100 = 4 %.
How do you go from churn to customer lifespan?
Take the inverse of the rate: 4 % monthly churn gives 1 ÷ 0.04 = 25 months of average lifespan. The calculation assumes the rate stays stable over time.
How do you calculate SaaS LTV?
On a subscription, LTV comes from churn: lifespan = 1 ÷ churn rate, then LTV = monthly revenue × lifespan. At 4 % churn and 39 € a month: 25 months of lifespan and 975 € of LTV. That is what the tool above computes, and it replaces the basket times frequency formula, which does not apply to a subscription.
Should new customers be counted in the calculation?
Never in the denominator. Adding customers won during the period dilutes churn and makes it look lower than it is. Only customers present at the start count.
Churn eating your acquisition?
That is the case as soon as customers lost outnumber customers won. No advertising budget compensates for that imbalance for long.
Keep My New Customers
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