Churn Rate

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Churn Rate

The rate at which customers terminate their relationships with a company over a given period of time. For example, if five customers in 50 discontinue their cable every month, the churn rate is 5%. The church rate contrasts with the growth rate, which, in this case, is defined as the number of new clients or customers. If a company is to grow, the growth rate must consistently exceed the churn rate. The churn rate is important in the telecommunications industry, where several companies operate in a geographical area and compete for customers.
References in periodicals archive ?
average of the four quarterly churn rates for 2005 create an average
Figure 5 shows that the industries with the highest churn rates are arts, entertainment, and recreation; accommodation and food services; professional and business services; construction; and retail trade.
As anticipated, churn rates for the third quarter was higher, owing to the churn of non-paying subscribers registered in the system primarily for the Free Facebook promotion in the first four months of the year.
Churn rates rose appreciably and operators took the opportunity to eliminate inactive SIMs from their records, giving them a better insight into growth opportunities.
This latest innovation brings enhanced support to TV operators worldwide in their mission to reduce churn rates.
Unlike many of our industry peers that struggle yearly with high customer churn rates, Virgin HealthMiles' significant 2011 growth and robust cash position from operations further underscores the value employers and their employees are getting from our solutions.'
Halaoui says that the mobile churn rates vary drastically between different markets, and depend on different factors, such as the maturity of the market, the price sensitivity of customers, the percentage of prepaid subscribers in the market, the competitive landscape, and most importantly, the pricing and commercial strategies of different operators within that market.
The analysts wrote, We are growing incrementally more cautious on the stock based on several key metrics: 1) ARPU pricing pressure to drive activations; 2) higher churn rates; and 3) higher SAC.
For 20 of the last 21 quarters, Verizon Wireless has led the wireless industry in customer loyalty, reporting the lowest churn rates among the four major U.S.
The availability of Cel-Fi technology will, according to Nextivity, strengthen NETGEAR's market position by allowing it to offer end users improved voice coverage and higher data transfer rates and also to offer network operators a tool which may reduce churn rates and improve customer satisfaction.
More than 84% of respondents to a CEB audit reported that the cost of acquiring and keeping customers is increasing, with 63% experiencing higher churn rates and attrition.
Those experiences have enabled EarthLink to not only lower churn rates to record levels, he says, but also raise profitability and customer satisfaction to all-time highs.