Prior Situation / Scenario
- Churn scores were ineffective because they predicted the churn event too late.
- Retention campaigns were reactive.
- Retention offers were costly and the same for all segments.
- Reactive churn campaigns.
Client Challenges
- Improve involuntary churn rates and reduce bad debt
- Retention & collection process was manual and lacked segmentation. Costly and ineffective offers were used to retain customers
- Lack of harmonized retention strategies. Contact center retention calls incurred substantial costs.
Strata Solution/ Key Enablers
Developed two “Propensity to Involuntary Churn” risk models and a new customer value segmentation (analyzed over 10M customer records and more than 550 variables). Defined a new collections process and actions that integrate value, risk, and created omnichannel contact journeys (Call Center, IVR, Email, SMS) to optimize costs and results based on value, risk, and prior contacts
Early detection of churn predictor events (wait time, claims, service, visits). Automated retention processes and established a retention matrix.
Outcome
Identified a sequence of events used as churn predictors in a propensity-to-churn algorithm that triggers retention treatments and actions. Designed and implemented pyramid approach segmentation criteria for stimulation campaigns to optimize contact, conversion, and impact. Transformed retention campaigns into proactive measures. Unified retention strategies based on customer value segments. Reduced bad debt by better identifying customers.
Results
In the first twelve months of the Retention & Marketing Automation Program, we reduced churn rates by 5-17% depending on the segment, while cutting contact center costs by 35%.
