Customer churn should be treated like the flu

Customer churn is often treated like the flu. Management assumes the root cause of the problem can’t be eliminated; the best they can hope for is to minimize the symptoms. But just as new medical breakthroughs empower physicians to attack the flu virus directly, it is possible to diagnose and repair the root causes of customer departures and dissatisfaction. In short, churn can be cured.- This is what I was tought some years ago in my first consulting advisory firm, and I have to say I do agree.

In the last couple of years mature telecom markets have reached full penetration and churn has become a key lever with direct impact on EBITDA performance. Therefore, a retention strategy is becoming critical in order to reduce costs and increase revenues.

But, is there a real effiicient way to manage this important telecom KPI? We think so. After executing several churn improvement projects across different countries and markets,  we believe in a holistic & comprehensive approach to churn, allowing clients to implement a long term strategy towards churn. Let me say that I’m not fond of prediction models and “intelligent” tools to advise churn reasons.

I believe it is necessary to fully understand the underlying reasons driving churn prior to entering in complex analytical models. That is why we focus all of our experience in helping telecom operators understand the churn drivers at work in their company. Our deep diagnostic analysis provides a full understanding of the reasons behind churn and prioritises the actions to obtain the maximum benefit.

Our approach has a direct impact on EBITDA earnings, reducing costs and improving the operator’s customer base value. Case you are interested in reading about it, feel free to download our churn point of view.

Regards. CVA

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