Churn rate analysis is a business strategy used to evaluate customer retention and loyalty by analyzing the percentage of customers that choose to discontinue their relationship with a company. By closely monitoring the amount of churn – the number of customers leaving over a certain period of time – businesses can identify potential problems or areas of growth. This understanding can form the basis for effective changes in customer service, pricing, or marketing campaigns. Analyzing churn rate is an essential element for any serious business as it helps improve customer satisfaction and ultimately leads to increased profits.