Proposed Project for Bank of America



| |Cingular Wireless |

| |Churn Reduction Analysis & Plan |

| | |

| |The Fuqua School of Business |

| |Marketing Practicum Course |

Background

Cingular Wireless is the second largest wireless company in the U.S. with over 22 million customers and annual revenues of more than $14.3 billion. Cingular operates in 43 of the top 50 markets nationwide. Cingular Wireless was created through a joint venture between the domestic wireless divisions of SBC (NYSE:SBC) and BellSouth (NYSE: BLS). Cingular's vision is to expand rapidly by offering customers advanced technologies in simple, cost effective ways that permit them to tap the creative potential of wireless through their own self-expression. Cingular is a wireless company determined to promote individual expression to a new level and to create a personal relationship with each of its customers.

One of the challenges facing all companies in the wireless business is the high rate of customer movement among providers, also known as churn. While Cingular continues to focus on building its business through acquisition of new customers, the retention of its current accounts is a high priority in which they are investing in technology, improved customer service, product development and marketing programs. Cingular has recognized that one of the key vehicles for enhancing retention is the Customer Care operation where Cingular telephone representatives handle customer inquiries regarding products, maintenance and billing. By providing these representatives with specific information about customers’ preferences and likelihood of churning, along with a set of recommended actions, Cingular will be able to increase the likelihood of keeping these accounts as Cingular customers.

Project Description

This project focuses on the development of a clear set of actions for Call Center representatives to take when customers are identified as high churn risks. Currently this is a manual process with the representative making the decision on appropriate actions. Cingular has developed predictive models that suggest a propensity to churn (churn score) as well as the expected Lifetime Value (LTV) for a customer. The output of these models as well as the underlying reasons for the score and LTV will be analyzed to determine the proper actions for a particular customer. Future technology Cingular plans to implement will allow the Churn Score, LTV and recommended actions to “pop up” on the Customer Care screens as a customer calls into the Center.

Additionally, Cingular would like to use the output of this process to drive proactive promotional campaigns using their Teradata CRM campaign management system. This would allow them to reach high risk customers before they call the Customer Care center to increase the probability of retaining them as a customer.

Objective

The objective of the project is to use current Cingular models and customer behavior information to develop a set of actions driving increased retention. These actions will be specific to customer individuals or segments and will drive both Customer Care representative behavior as well as proactive promotional campaigns.

Students participating in this project will be exposed to the use of sophisticated modeling techniques and CRM technology supporting both customer service and promotional campaigns, all in the context of the highly competitive and marketing-focused wireless industry.

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