Customer Attrition - Predicting Customer Attrition

Predicting Customer Attrition

In the business context, “churn” refers both to customers’ migration and to their loss of value. So, “churn rate” refers, on the one hand, to the percentage of customers who end their relation with the organization or, on the other hand, to the customers who still receive their services, but not as much or not as often as they used to. Current organizations face therefore a huge challenge: to be able to anticipate to customers’ abandon in order to retain them on time, reducing this way costs and risks and gaining efficiency and competitivity. There are in the market advanced analytics tools and applications, especially designed to analyze in depth the enormous amount of data inside the organizations, and to make predictions based on the information obtained from analyzing and exploring those data. Their aim, to put at the service of marketing departments and agencies –and of all business users- the necessary weapons to:

• Detect soon which customers are about to abandon and to know them in depth, answering to questions such as: Who are they? or How do they behave?
• Know the real value of the potential loss of those customers, with the aim of establishing priorities and distributing business efforts and resources efficiently, optimizing resources and maximizing the value of the current customers’ portfolio.
• Put into practice personalized retention plans in order to reduce or avoid their migration, increasing the capability to react and anticipating to possible non-predicted fugues.