Churn Rate in Ecommerce: How To Calculate and Reduce It (2026)

Ecommerce churn rate measures the percentage of customers a business loses over a set period of time. A skincare customer who buys a $50 cream once generates $50 in revenue, for example. One who buys it monthly for a year generates $600. Repeat purchases increase customer lifetime value and improve profitability.

Bluecore’s 2025 Customer Growth Benchmarks Report found that repeat buyers spent more than new customers across every retail category studied. In jewelry and accessories, retained customers spent 92.8% more than new buyers.

This guide explains how to calculate churn rate for your ecommerce business and find opportunities to keep customers coming back.

What is churn rate in ecommerce?

Churn rate in ecommerce, also called the customer attrition rate, is the percentage of customers who stop buying from your business during a defined period. How you identify those customers depends on your business model.

For subscription-based businesses, churn occurs when a customer’s subscription ends. Voluntary churn happens when customers choose to cancel. Involuntary churn is when a subscription ends because of an unresolved payment failure, such as an expired credit card.

For non-subscription businesses, customers rarely announce they’re leaving. You calculate churn by identifying customers who haven’t reordered within a time period that reflects your usual purchase cycle.

Ecommerce customer retention measures how many customers keep buying, while churn measures how many leave. For the same customer group, period, and measurement rules, a 5% customer churn rate means a 95% retention rate.

How to calculate churn rate

The customer churn formula is:

Customer churn rate = (Customers lost during the period / Customers at the start of the period) x 100

Track customer retention and acquisition separately so new customers don’t hide losses from your existing customer base.

Monthly and annual churn aren’t interchangeable. Assuming a constant churn rate and no returning customers, for example, 5% monthly churn means losing about 46% of the original customer group over a year.

Regular ecommerce businesses

For stores selling through individual purchases, calculate churn using purchase history:

1. Identify your usual reorder interval. Review repeat customers’ orders to see how long they wait between purchases. Account for differences between products and seasonal buying patterns.
2. Choose an inactivity cutoff. If customers reorder every three months, test a six-month cutoff.
3. Compare customer cohorts. Group customers by the month of their first purchase, then give everyone the same amount of time to reorder.

For example, suppose 1,000 customers first buy in January. If 300 reorder within six months of their first purchase, the other 700 represent an estimated cohort churn rate of 70%:

(700 / 1,000) x 100 = 70%

This measures customers who failed to make a second purchase within your chosen window. They can still return later.

Shopify’s customer cohort analysis report groups customers by their first order date and tracks subsequent purchases, helping you compare retention across cohorts. Churn prediction software can identify customers at risk of leaving so you can prioritize retention outreach.

Subscription ecommerce businesses

Say you have 100 subscribers on Oct. 1 and lose five of those customers during the month. Your monthly customer churn rate is:

(5 / 100) x 100 = 5%

Acquiring 10 new subscribers that month increases your total customer count, but the five lost customers still count as churn. Count a customer as lost when their last active subscription ends.

The Shopify Subscriptions app’s performance metrics show subscription revenue and the number of new, active, and canceled subscriptions for your selected period. Active subscriptions include paused contracts and skipped orders. These counts measure subscription contracts, so calculate customer churn using unique customers.

You can also explore third-party subscription apps. Check which churn reports each app provides and how it calculates them before comparing results.

Revenue churn and negative churn

Customer churn counts the customers you lose. Revenue churn measures the recurring revenue lost when customers cancel or reduce their subscriptions:

• Gross revenue churn measures revenue lost to cancellations and downgrades as a percentage of recurring revenue at the start of the period.
• Net revenue churn subtracts gains from existing customers, such as subscription upgrades, from those losses before dividing by starting recurring revenue. Some reporting tools also include revenue from reactivated customers.
• Negative churn occurs when those revenue gains exceed the losses. Your existing customer base generates more recurring revenue overall, even if some customers leave.

Say a store starts the month with $10,000 in recurring revenue, loses $500 to cancellations and downgrades, and gains $800 from upgrades. Gross revenue churn is 5%, and its net revenue churn is −3%. Exclude revenue from newly acquired customers from both calculations.

What is the average customer churn rate?

For subscription ecommerce businesses, Recurly’s July 2026 network data showed a median annual churn rate of 4.25%. Involuntary churn accounted for 1.38 percentage points, or nearly a third of the total. When comparing average customer retention rates by industry, check the business model and measurement period behind each figure.

For non-subscription stores, compare cohort churn against your own repurchase patterns and historical results. A customer buying furniture has a different purchase cycle from someone replenishing skin care. The same inactivity cutoff would classify those customers very differently.

Compare cohorts over equal periods and account for seasonal buying patterns. A rising share of customers failing to reorder within your usual purchase window gives you a specific trend to investigate.

5 ways to reduce churn rate

Choose a customer retention strategy based on why customers leave. For example, product complaints call for a different response than failed payments.

Review cancellation reasons, customer feedback, and billing records to identify the problem before choosing a fix.

1. Product experience

In PwC’s 2025 Customer Experience Survey, 52% of consumers said they had stopped using or buying from a brand after a bad experience with its products or services.

Review product complaints and return reasons, then ask departing customers what disappointed them. If buyers repeatedly report leaking bottles, for example, fix the packaging and track whether complaints decline. Addressing recurring defects gives customers fewer reasons to abandon a product they otherwise want.

2. Aligning purchase cycles

Correspond subscription deliveries with how quickly customers use your product. If a customer takes six weeks to finish a cream, for example, a monthly delivery can leave them with more than they need.

Offer delivery intervals that reflect those usage patterns, along with options to skip or pause an order. For customers who buy products as needed, schedule replenishment emails around their expected reorder date. Adjust the timing as their purchase history develops.

3. Customer service

Poor customer service can drive customers away. In PwC’s survey, 29% of consumers said they stopped using or buying from a brand because of a poor online or in-person customer experience.

Give your customer service team authority to resolve common problems. For an order delivered to the wrong address, that could mean promptly arranging a replacement. Review repeat contacts to find issues customers have to chase more than once.

4. Failed payment recovery

A failed subscription payment can end a customer relationship even when the customer wants to continue. A subscription recovery process retries failed payments and prompts customers to update their billing details.

In Shopify Subscriptions, go to Settings > Billing attempts to manage payment retries. You can set the number of attempts and the days between them. You can also choose whether to skip, pause, or cancel the subscription after all attempts fail.

5. Loyalty and rewards

Give repeat customers rewards they can understand and redeem. For example, offer a discount after a set number of purchases and make their progress visible.

In Capgemini’s October 2025 survey, 65% identified a competitor’s better or higher-value loyalty program as a compelling reason to switch brands or retailers.

With Shopify customer segments, you can group customers by purchase behavior and target them with emails or discount codes. For example, send an offer to repeat customers who are overdue for another purchase, and track how many return.