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Customer Service: Reducing churn and bringing in money

By Phil Verghis on April 1, 2010

A highly under-rated and under-used partnership is between marketing and customer support/customer service. I’m working with a large client now where (as part of a larger engagement) we explored and developed a partnership between marketing and customer service that has resulted in more loyal customers that at the same time yields tens of thousands of dollars of incremental revenue a quarter.

Yes, it can be done without turning customer service and support into sales people. They always have to be the customer’s advocate. However, understanding the customer lifecycle, personas and churn risk points and making that part of the support DNA helps. Dramatically.

Embedded in this interesting article from the Economist is something similar that Cablecom (a Swiss cable tv/internet/phone provider) did.

“Like many telecoms providers, Cablecom has grappled with churn.  Using advanced data analytics, Cablecom discovered that although customer defections peaked in the 13th month, the decision to leave was typically around the 9th month (as indicated by things like the number of calls to customer support services).  To reduce defections, Cablecom offered at-risk customers special deals 7 months into their subscription. 

The results were impressive:  customer defections fell from 20% of subscribers a year to under 5%, enabling the firm to save significant marketing acquisition costs while boosting customer satisfaction.”

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