Customer Churn Analytics
Given the high costs of customer acquisition in myriad industries, reducing customer churn through an intelligent segmentation of your customer base is essential to business viability. Leverage your customer data to reduce customer churn and reap maximum benefits from a well-segmented and thoroughly analyzed customer database.
Challenges and Opportunities
Customer attrition or churn is a rate that measures the number of clients whose business is lost over a particular timeframe. In highly competitive industries where substitute products or services are readily available and the cost of retaining an existing customer is significantly lower than the cost of acquiring a new one, reducing customer churn is the key to long-term profitability. Customer segmentation—dividing a customer base into geographic, demographic, behavioral, and income categories so as to more effectively target products and services—is the key to reducing customer churn. The better segmented your customer data, the more efficiently you can invest scarce resources in those consumers who are most likely to respond to your offerings and the more able you will be to iteratively refine your products and services so as to retain their loyalty.
The challenge for many businesses is that the data required to reduce customer churn is:
- Not gathered from across the organization using the best data mining techniques
- Not analyzed using the most sophisticated and innovative algorithms
- Not stored securely in line with the latest data security practices
Experfy can help you to diagnose and overcome your customer data challenges and develop a program of action to harness that data to reduce customer churn in your specific industry.
Experfy has deep expertise in customer lifetime value modeling and the measurement of ROI in marketing. The foundation of our approach is to analyze how your organization gathers data about its customers and what data gaps you must address. Our mission is to enhance your capacity to mine customer data or capitalize on existing data which is both a technological and a business structure issue. Who are your customers? How do they behave? What data should be collected about them? How should we be gathering information about them? How do we place that data in the hands of those who can best use it? What technologies and business practices facilitate this?
Once that fundamental challenge is addressed, our consultants can help you to harness sophisticated Big Data techniques such as machine learning and predictive analytics to calculate and analyze your churn rate—percentage of customers whose business is lost per quarter or year; anticipated profit potential and lifetime revenue per customer by income, geography, demographics, etc.; discount rate—the cost of capital used to discount future revenue from a customer; retention cost—the amount of money required to retain a customer per quarter or year; and other metrics that may be important to your specific business. Having acquired and analyzed the data, we will make a strategic recommendation as to how best to harness it. Specifically, we can help you to design strong and highly personalized loyalty programs by identifying those services, support, and promotional offers that your most valued customer segments require to remain in good standing or increase their spending with your company. We can also help you to identify the customers that you don’t want because their risk profile is too high or their contribution to your bottom line is too minimal to warrant the investment.
Finally, we will help to train your personnel in how to secure customer data. This latter point should not be underestimated as the personal information and deep consumer insights that makes effective customer targeting possible also makes that data attractive to thieves. The battle to secure customer data is an iterative and ongoing one that requires ever-increasing sophistication. Failure in this struggle can have profoundly negative consequences for your brand as Yahoo! and Target have unfortunately learned. Experfy can help you to determine the weaknesses in your approach to data security and how to best protect one of your most valuable assets: your customer data.
We will be your partners in delivering actionable recommendations to reduce customer churn.
Tell Us About Your Specific Project
To assist our consultants and data scientists in developing a customized solution for you, please provide the following information:
- What products and services do you sell?
- Who are your target customers within your industry?
- What is the problem you are looking for assistance with?
- How is your marketing operation organized?
- Describe the systems that are utilized to hold your customer data.
- How much data do you have?
- What data techniques do you currently use to analyze your customers?
- Do you use a marketing platform and if so, which one?
- What technologies and security protocols do you use to protect your data?
- Have you experienced any data breaches?
Project Framework & Pricing
Depending upon the size of your organization, the state of your data and the volume of information to be analyzed, we can complete our consulting engagement in 3-4 weeks at a cost starting at $10,000, depending on the deliverables selected.
Step 1: Analysis of Data Operations
Assessment of business operations and technologies utilized to mine customer data. Identification of customers and their behaviors.
Documentation including recommendations on how to mine and deploy customer data to maximize its utility in your organization.
Step 2: Analysis of Customer Data
Use Big Data techniques to analyze and forecast key customer data metrics such as churn rate, segment customer data, and calculate lifetime value of customers.
- Recommendations on how to best design customer loyalty programs, reduce customer churn and increase lifetime value of customers.
- Identification of most valuable and riskiest customers.
- Formal presentation and high level documentation supporting how to best implement recommendations.
- Creation of dashboard to display key data inputs and model outputs.
Data Security Assessment
- Investigation of the weaknesses in your customer data security.
- Formal presentation and documentation including recommendations of the best practices and technologies required to address identified data security challenges.
- Data Security Training