Reducing customer churn

Reducing customer churn and increasing retention in a timely fashion to generate leads and to focus on the specific needs of customers

The client, one of the largest  plumbing and drain-cleaning  services in North America, had  problems with customer churn. To  improve customer retention, the  client asked Intuceo to identify which  customers were most at risk of  churn and what services they would  most likely request. With this  knowledge, the client could replace  its one-size-fits-all email marketing  with targeted campaigns that  address the specific needs and  service requirements of customers.

Using an ensemble model, Intuceo  analyzed the client’s customer-  service data and engineered time-  dependent attributes that captured  the periodicity of service visits (e.g.,  first service date vs. last service  date, last service date vs. next  service date, etc.). Based on the  intervals between service visits, the  target attribute, broken into two  classes, was determined by:

Class 1: customers with service  interval < 180 days = low risk of  churn

Class 2: customers with service  interval > 180 days = high risk of  churn

Customers were also classified  by likely service request type.

Hundreds of actionable insights  were generated. The dozen or so  patterns that would yield the  greatest revenue were presented as  clear charts (see the figure) and  simple if–then rules that can inform  strategic email marketing.

The client can now rank order  customers by (a) when they are  likely to request service and (b)  service type. This enables the client  to focus on customers who have not  called within six months. The client  can also entice customers to place  orders by tailoring offerings to meet  their needs. This results is higher  retention


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