idiro analytics - what is rotational churn and how can we tackle it?
TRANSCRIPT
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What is rotational churn
– and how can we tackle it?
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What we’ll cover
1. Definition2. The problem of rotational churn3. Effects 4. Causes & categories5. Combating spinning
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What is rotational churn?(also known as spinning)
• One of your customers gets a new subscription from you
• …and gets rid of the old SIM (and sometimes the phone too)• …without telling you
So this customer appears on your systems as 2 people:
•A leaver•A new joiner
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Rotational Churn in Context
How a typical spinner is likely to behave when they change their handset
SpinChurn or spin, to
best new customer offer
UpgradeChurn and bring their number or
upgrade
Brand loyaltyHigh Low
Loyalt
y t
o
ph
on
e n
um
ber
Hig
hLow
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The Cost of Rotational Churn
1. Spinning wastes money and resources on: • Welcome packs, welcome calls…• Save / winback,
2. The Churn rate is overstated
3. Acquisition campaign success rates are overstated
4. Spinning can increase churn - many spinners are potential true churners
5. Valuable customer history data for spinners is lost.
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What Triggers Rotational Churn?
All manner of things...
1. The customer’s phone is stolen or permanently lost.
2. The customer’s phone is broken.
3. The customer gets a new phone with work, from the same operator as they are currently on.
4. The customer receives a phone as an unsolicited gift
5. The customer wants a new phone e.g. because he / she perceives her phone is out of date.
6. The customer decides to change her number
7. The customer wishes to avoid a debt and stay on the same network
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Measuring Rotational Churn
4 methods:
1. IMSI / IMEI matching2. Market research (calling customers)3. Name & address matching4. Idiro Fingerprinting
Of the 4 methods, Idiro Fingerprinting is by far the most comprehensive. The other 3 should also be use where possible.
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Idiro Fingerprinting: the solution
Communication patterns in communities are relatively stable over time.
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Idiro Fingerprinting: the solution
However, if someone were to leave the community…
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Idiro Fingerprinting: the solution
They leave a structural hole in the community.
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Idiro Fingerprinting: the solution
If a newcomer fills this structural hole and re-establishes many of the links of the person who departed then the newcomer is very likely to be the same person who departed.
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How Idiro Identifies Spinners
Principle 1:• A subscriber may change the phone number
as a spinner, but this would not change his community.
Principle 2:• Social networks are fairly stable over time.• The community is stable over time and
everyone has his unique community.
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Output of Idiro Fingerprinting
Churner NewcomerProbability that Churner and
Newcomer are the same person
7941 111111 7941 222222 99.3%7941 345345 7941 369369 98.3%7941 191191 7941 239111 95.0%7941 909909 7941 897722 94.6%7941 888111 7941 349922 82,1%7941 167167 7941 224444 76.8%7941 611009 7941 300011 71.1%7941 171411 7941 800022 71.0%
• The Idiro Fingerprinting model matches customers to new joiners – and gives a probability score
• Idiro also provides consulting support in tackling the problem of rotational churners
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Exploiting the results of Idiro Fingerprinting
Measure
Focus
Change
•Correct the headline churn rate•Correct the acquisition rate and cost per subscriber
•MIS / market research on spinners to segment by:
•Acquisition offer (MIS)•Retail channel (MIS)•Trigger (mkt research) •Etc.
•Develop improved upgrade propositions / care strategy / communications to address different types of spin -> reduce spin and true churn rates
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For more information on rotational churn and how to
tackle it, contact Idiro