Churn rate
The churn rate or -rate ( English churn (rate) of to churn move = jmdn., Stir) is a concept of economics , which mainly from the telecommunications is known and also in the area of subscription sales has found its place and in the Internet marketing.
The churn rate defines the number of customers or subscribers who no longer use the service recorded over a certain period of time, divided by the number of total customers. It gives an overview of the growth or decrease in the number of customers as well as the average length of service participation.
This percentage result is very useful for measuring customer satisfaction depending on the industry and accordingly taking marketing measures to reduce the churn rate. A typical short-term means of increasing competitor churn is to turn the price spiral. Measures to reduce the churn rate would be, for example: customer recovery and increasing customer satisfaction. When taking measures to reduce the churn rate, economic and relational reasons for emigration should be taken into account for services, especially telecommunications services. Customers migrate when the price-performance ratio is no longer balanced, the behavior of the employees leads to dissatisfaction or the service process is not transparent or leads to feedback from the customer. Feedback can e.g. B. waiting times, inquiries from the customer, long processing times or changing contacts.
The churn rate is particularly important in market areas in which customers are very willing to change their providers (e.g. telephony, Internet providers, energy suppliers). For example, the option of porting phone numbers has led to an increased churn rate of customers, as an important reason for preventing change has been removed.
In marketing, so-called customer relationship management tools (CRM tools) are also used, which make all customer relationship data available centrally in a database .
Individual evidence
- ↑ Nesper, J. (2014): (Un) fairness-based customer churn in service relationships - success factors and strategies for churn management in the telecommunications industry, Hamburg 2014