Logo Churn
Growth
Usage
Industry:
Sector Agnostic
Short Definition
Logo Churn is defined as the number of customers (or "logos") that a company loses during a given time frame. It is a critical metric used to measure customer retention and the stability of a company’s customer base, particularly in subscription-based models.
Short Definition
Logo Churn is defined as the number of customers (or "logos") that a company loses during a given time frame. It is a critical metric used to measure customer retention and the stability of a company’s customer base, particularly in subscription-based models.
Short Definition
Logo Churn is defined as the number of customers (or "logos") that a company loses during a given time frame. It is a critical metric used to measure customer retention and the stability of a company’s customer base, particularly in subscription-based models.
Why it matters for Investors
Retention insight: Indicates the rate at which customers are leaving, impacting long-term revenue stability.
Growth risk: High logo churn may signal dissatisfaction or competitive pressure, affecting growth prospects.
Valuation impact: Lower churn strengthens customer lifetime value, influencing company valuation.
Why it matters for Investors
Retention insight: Indicates the rate at which customers are leaving, impacting long-term revenue stability.
Growth risk: High logo churn may signal dissatisfaction or competitive pressure, affecting growth prospects.
Valuation impact: Lower churn strengthens customer lifetime value, influencing company valuation.
Why it matters for Investors
Retention insight: Indicates the rate at which customers are leaving, impacting long-term revenue stability.
Growth risk: High logo churn may signal dissatisfaction or competitive pressure, affecting growth prospects.
Valuation impact: Lower churn strengthens customer lifetime value, influencing company valuation.
Formula
Practical considerations:
Customer scope: Include only customers (logos) who have terminated their contracts or subscriptions during the specified period.
Timeframe alignment: Calculate logo churn over a consistent period (e.g., monthly, quarterly, annual) based on the business cycle.
Definition clarity: Ensure consistency in defining a "lost customer" (e.g., non-renewal, cancellation) across reports.
Policy clarity: Document how partial losses, downgrades, or reactivations are handled in the count.
Formula
Practical considerations:
Customer scope: Include only customers (logos) who have terminated their contracts or subscriptions during the specified period.
Timeframe alignment: Calculate logo churn over a consistent period (e.g., monthly, quarterly, annual) based on the business cycle.
Definition clarity: Ensure consistency in defining a "lost customer" (e.g., non-renewal, cancellation) across reports.
Policy clarity: Document how partial losses, downgrades, or reactivations are handled in the count.
Formula
Practical considerations:
Customer scope: Include only customers (logos) who have terminated their contracts or subscriptions during the specified period.
Timeframe alignment: Calculate logo churn over a consistent period (e.g., monthly, quarterly, annual) based on the business cycle.
Definition clarity: Ensure consistency in defining a "lost customer" (e.g., non-renewal, cancellation) across reports.
Policy clarity: Document how partial losses, downgrades, or reactivations are handled in the count.
Worked Example
Line Item | Amount | Notes |
|---|---|---|
Customers Lost | 25 | Terminated contracts in a quarter |
Logo Churn | 25 | Total count |
Notes:
Excludes 5 downgraded accounts, per policy.
Includes 3 reactivated customers excluded from the count.
Worked Example
Line Item | Amount | Notes |
|---|---|---|
Customers Lost | 25 | Terminated contracts in a quarter |
Logo Churn | 25 | Total count |
Notes:
Excludes 5 downgraded accounts, per policy.
Includes 3 reactivated customers excluded from the count.
Worked Example
Line Item | Amount | Notes |
|---|---|---|
Customers Lost | 25 | Terminated contracts in a quarter |
Logo Churn | 25 | Total count |
Notes:
Excludes 5 downgraded accounts, per policy.
Includes 3 reactivated customers excluded from the count.
Best Practices
Accurate tracking: Use CRM or subscription management tools to log customer losses.
Segmentation: Analyze logo churn by customer segment, region, or product to identify trends.
Regular updates: Recalculate with each reporting period or customer status change.
Transparency: Disclose logo churn calculation methods, including exclusions, in performance reports.
Retention strategy: Use churn data to improve customer satisfaction and reduce losses.
Best Practices
Accurate tracking: Use CRM or subscription management tools to log customer losses.
Segmentation: Analyze logo churn by customer segment, region, or product to identify trends.
Regular updates: Recalculate with each reporting period or customer status change.
Transparency: Disclose logo churn calculation methods, including exclusions, in performance reports.
Retention strategy: Use churn data to improve customer satisfaction and reduce losses.
Best Practices
Accurate tracking: Use CRM or subscription management tools to log customer losses.
Segmentation: Analyze logo churn by customer segment, region, or product to identify trends.
Regular updates: Recalculate with each reporting period or customer status change.
Transparency: Disclose logo churn calculation methods, including exclusions, in performance reports.
Retention strategy: Use churn data to improve customer satisfaction and reduce losses.
FAQs
What is included in Logo Churn?
The number of customers lost during a given time frame, adjusted per policy.Can Logo Churn increase?
Yes, due to poor service, competition, or economic factors.How are downgrades handled?
Exclude from logo churn unless they result in contract termination, per policy.Is it the same as Revenue Churn?
No, Logo Churn counts lost customers, while Revenue Churn measures lost revenue.What if a customer reactivates?
Exclude from the count if reactivated within the period, per policy.
FAQs
What is included in Logo Churn?
The number of customers lost during a given time frame, adjusted per policy.Can Logo Churn increase?
Yes, due to poor service, competition, or economic factors.How are downgrades handled?
Exclude from logo churn unless they result in contract termination, per policy.Is it the same as Revenue Churn?
No, Logo Churn counts lost customers, while Revenue Churn measures lost revenue.What if a customer reactivates?
Exclude from the count if reactivated within the period, per policy.
FAQs
What is included in Logo Churn?
The number of customers lost during a given time frame, adjusted per policy.Can Logo Churn increase?
Yes, due to poor service, competition, or economic factors.How are downgrades handled?
Exclude from logo churn unless they result in contract termination, per policy.Is it the same as Revenue Churn?
No, Logo Churn counts lost customers, while Revenue Churn measures lost revenue.What if a customer reactivates?
Exclude from the count if reactivated within the period, per policy.
Related Metrics
Commonly mistaken for:
Revenue Churn (Measures dollar loss, not customer count)
Customer Turnover (May include voluntary and involuntary losses broadly)
Active Users Lost (Focuses on usage, not contracts)
Related Metrics
Commonly mistaken for:
Revenue Churn (Measures dollar loss, not customer count)
Customer Turnover (May include voluntary and involuntary losses broadly)
Active Users Lost (Focuses on usage, not contracts)
Related Metrics
Commonly mistaken for:
Revenue Churn (Measures dollar loss, not customer count)
Customer Turnover (May include voluntary and involuntary losses broadly)
Active Users Lost (Focuses on usage, not contracts)
Source of:
Components:
Index