Home References What is Churn management?

Churn management is the art of identifying the valuable customers, who are likely to churn from a company and executing proactive steps to retain them.

The telecommunication industry has got fierce competition among the various service providers. And, thus they keep introducing new alluring offers every another day, making the customers switch from one competing mobile service provider to another. This customer tendency to switch is referred to as Churn.

The importance of Churn management

The percentage of a service’s subscribers that discontinue its subscription to the service within a time period is called Churn Rate. While a high churn rate implies that a company loses a high percentage of its subscribers every month; a company’s low churn rate statistics justifies its capability of retaining its subscribers with a quality service. Thus, companies try their level best to lower churn by retaining their customers.

Churn can be classified into three categories:

  • Account Churn- Where the customer is completely lost
  • Product Churn- Where the customer has lowered his subscription profile
  • Decreased Spend- Where the customer has reduced his spending without changing his subscription profile

As the customer acquisition costs are continuously increasing, customer churn management has become critically important. High Churn Rate depicts various aspects such as unsatisfactory service, unsatisfied customers and the class of its customers and thus, Churn management becomes essential. However, it is quite crucial as we don’t know:

  • How to manage the critical customer relationship optimally
  • Who the customer would be
  • What they exactly want
  • What makes them go and what makes them stay

Churn Management involves the tracking of two customer metrics- Churn Score and Customer Value.

  • Churn Score- The calculation of customer behavior
  • Customer value- Calculated on the basis of customer’s desires and satisfaction

Both these values are calculated and fed to the company’s CRM system through application messaging from analytics applications and are updated in the consumer component’s attributed page. The CSRs as well as other company officials can see their customer churn score opening up the records. Evaluating the customer churn score, a company can go for the best suited actions, generally referred to as customer retention tools.

There may be several or a single issue within a company’s functional chain leading to customer churn. Beit revenue issue, or improper marketing, or sales issue, or customer dissatisfaction, or network coverage issue, or even issues with the new technologies and strategy; anything can lead to alarming churn statistics.


Within a saturated market for the communication service providers, customer acquisition no longer ensures sustainable revenue. The paradigm has moved towards customer retention. The current scenario full of challenges for every telecom service provider states churn management as the door to revenue growth.

Now, amazing the subscribers by demonstrating how much you understand their needs is the key to success.A better customer understanding, how to target them and what they need can help in reducing churn and lowering the marketing costs substantially.

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