A:

Mobile network carriers, part of the telecommunications sector, refer to a churn rate as the percentage of customers during a given period of time who discontinue services for any reason. Churn rates are often used to indicate the strength of a company’s customer service division and its overall growth prospects. Lower churn rates suggest a company is, or will be, in a better or stronger competitive state.

Minimizing Churn Rates

Customer loss impacts carriers significantly as they often make a significant investment to acquire customers. Companies use a variety of different metrics to determine when customers are about to churn, or leave. It is profitable for companies to explore the reasons why customers are leaving, and then target at-risk customers with enticing offers.

There are a number of different tactics companies use to maintain their customer bases. One of the most important is simply providing efficient customer service. Providing clients with an easy way to get questions answered and issues handled is key to maintaining cellular clients.

A commonly used tactic is for a carrier to offer upgrades on the client’s existing account. Expanding on services offered and giving better rates or discounts to the client often improves customer retention rates.

Another tactic is offering free access or reduced rates on smartphone applications. The increasing regular use by customers of cellphone applications makes free access to such applications an enticing bonus for many customers.

Accessories

The offering of accessories for a customer’s phone is another customer retention tool. The best or nicest chargers, Bluetooth accessories, covers or phone stands can be relatively expensive, so customers appreciate the ability to obtain them at no cost.

From the other side, competing cellular providers aggressively market special deals to churn customers away from their current provider. Common practices include offering free phones and buying out any existing service contract. The cellular service business is highly competitive and will likely remain so; therefore, churn rates will continue to be an important focus for cellular providers.

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