is a marketing
term, one of those cute little euphemisms
that sounds good but means less than one would think (see: shrink
) The term refers to loss of sales revenue due to customer defection to the competition.
Note that the term does not encompass loss of revenue to other sources, such as a cell phone customer deciding they can survive with only a land line or automobile owners deciding to sell the car and bike to work. Churn refers specifically to those who are dissatisfied with the company's product to the point of giving money to a competitor.
The figure is generally represented as a percentage of overall customer loss ('we lost 500 customers last month, half of which was due to churn') and is a pretty solid indication of customer dissatisfaction - the lower the churn, the better.