Insurance companies and subscription services are well aware of the concept of churn – every year, a certain number of customers are lost and must be replaced. Standing still is the equivalent of losing, as seen in the model called the “Red Queen Effect.” Churn is present in many business and human systems: A constant figure is periodically lost and must be replaced before any new figures are added over the top.
Source:
Shane Parrish’s Farnam Street Mental Model Guide
