Reducing customer departures and defections has become a chief priority for most communications service providers as markets mature and competition intensifies.
So why do high levels of customer churn persist? In the past these companies thrived as customer acquisition machines, built to grow through rapid penetration of the digital television, Internet and voice products they introduced. They still invest more in advertising and marketing than they do in service technicians or set-top box capabilities that would delight or at least retain customers.
As a result, churn tends to hover around 2% to 2.5% per month. For a wireline company with 5 million customers, that means an estimated 1.32 million people and $2 billion in revenue walk out the door each year.