Who stays and who leaves
If 1,000 customers start the month and 30 cancel, monthly customer churn is 3%. For that original group, retention is 97%. An active-user count may include newcomers, so teams decide how to count customers who join or return during the month.
Cohort retention tracks how many people who started at about the same time keep using the product. Revenue churn tracks lost revenue rather than lost accounts, so one large customer can matter more than several small ones.
Match the measure to the product
A payroll tool might check monthly use; a messaging app might check daily use. Cancellation, inactivity, and failed payments show different kinds of loss. Teams specify what counts as staying or leaving, which customers are included, and the time period.