Churn Rate

Churn Rate: what is it?

Churn is borrowed from subscription businesses and it fits coaching exactly, because a coaching roster behaves like a bucket with a hole in it. New clients pour in at the top, churn drains out the bottom, and the size of the hole decides whether the bucket ever fills. Most coaches feel churn as a mood ("it has been quiet lately") rather than measuring it, which is why the same problem repeats every year.

The formula, and the version that matters more

Client churn for a period is clients lost divided by clients at the start of the period. Count only clients who were there at the start, so that new signups do not mask the losses.

Revenue churn is the same calculation on money rather than headcount, and it is the more honest number once your clients pay different amounts. Losing one client on your premium package is not the same event as losing one on your cheapest tier, even though headcount churn scores them identically.

What churn does to your workload

The tenure relationship is the part that changes behaviour. At a steady monthly churn rate, the average client stays roughly one divided by that rate, in months. At 10% monthly churn the average client lasts about ten months; at 20% they last about five. That means doubling your churn does not just halve your revenue per client, it doubles the number of new clients you must find every year simply to stand still.

This is why a coach with a full roster can still feel like they are constantly selling. The selling is not ambition, it is replacement.

Voluntary, involuntary and expected churn

Not all churn is the same problem, and lumping it together hides the fixable part.

Reading your churn without over-reacting

On a small roster, churn is a noisy number. Losing two clients out of twenty is 10%, and it can be a coincidence rather than a trend. Look at a rolling three-month figure and at the reason attached to each departure before you change anything structural.

Record a reason for every client who leaves, in one line, at the time it happens. After a year that list is the most useful business document you own, and it will almost certainly point at one stage of your process rather than at your programming.

It is also worth separating churn by how long the client had been with you. Clients who leave in the first six weeks and clients who leave after a year are two different problems: the first is usually onboarding, expectation-setting or a bad fit at the point of sale, and the second is usually a goal reached with nothing proposed after it. Averaging them into one number produces an answer that describes neither, and coaches then fix the stage that was already working.