Seller Churn Rate is a metric used to measure the rate at which merchants or sellers leave an online marketplace over a specific period of time. It is an important indicator of seller satisfaction and the platform's ability to retain sellers in a competitive environment. A high churn rate may signal problems with the marketplace's offerings, policies, or support, while a low churn rate suggests that sellers are generally satisfied and find value in staying on the platform.
To calculate the Seller Churn Rate, you can divide the total number of sellers at the beginning of the period by number of sellers who left the platform during a period.
A 5% Seller Churn Rate means that 5% of sellers left the platform during the month.
Monitoring and addressing Seller Churn Rate is crucial for online marketplaces, as retaining sellers is key to maintaining a wide range of offerings and attracting buyers. High churn rates can lead to a decline in product variety, reduced liquidity in the marketplace, and potential damage to the platform's reputation.