Which term defines the percentage of customers that stop using a product or service over time?

The term that defines the percentage of customers who stop using a product or service over time is known as churn rate. This metric is crucial for businesses as it helps them understand customer behavior and retention challenges. Churn rate quantifies the rate at which customers discontinue their relationship with a company, providing insights into customer dissatisfaction, competition, or market dynamics. A high churn rate can be a signal for companies to improve their products, customer service, or engagement strategies to retain their customer base.

In contrast, retention rate measures the percentage of customers that remain with a product over a particular period, which is the opposite of churn. Acquisition rate refers to the percentage of new customers gained and is essential for growth analysis, while market share indicates the portion of an industry or market that a particular company controls. Understanding churn rate is fundamental to developing strategies for enhancing customer loyalty and improving business performance.