Attrition and churn are two related business concepts that can have a major impact on an organization’s bottom line. Understanding the difference between the two is key to managing customer relationships effectively over time.
Attrition refers to the natural loss of customers or subscribers over time. These losses could be due to changes in customer preferences, moves, or other personal factors. Attrition usually happens gradually and is something that most businesses plan for.
Churn, on the other hand, is a term used to describe an accelerated rate of customer loss. Customer turnover is higher than normal, often caused by rapid changes in the competitive landscape or customer dissatisfaction with products or services. Churn can cause sudden losses in revenue, so it’s important for businesses to stay aware of this risk and take steps to minimize it.