Churn Management |
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High cost of customer acquisition and customer education require
companies to make large upfront investments in customers. Customer
retention, therefore, is becoming critical to customer profitability.
Customers need to spend a threshold amount of time before they
break even and start generating profits. However, due to easy
access to information and a wide range of offerings, it is easier
than ever before for customers to switch between service providers
- be it in the area of credit cards, mortgages, telecom or insurance.
Clearly attrition or churn is costly business.
Studies reveal that retaining a customer is much easier before
he has slipped into active or passive attrition. Therefore, the
key to attrition management is to reach out to the customer before
she disassociates with you actively or passively.
Predictive modeling can help you identify sub-segments of your
customer base that is likely to churn away from you, providing
you a well identified segment to target with retention programs.
In a recent deployment of an attrition model we were able to detect
75% cancellations in just 8% of the population. Not just that our
attrition models made these detection two months before actual
cancellation, providing the client ample time to save these accounts.
Accurate attrition models can save you millions from lost revenues.
On most occasions investments on attrition models and retention
programs can provide higher return on nvestments than spends on
fresh acquisition.
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