No abstract

No abstract

The wireless telecommunication industry is highly competitive and managing customer churn is of great concern to wireless carriers as the market matures. Recent research has indicated that wireless rate plans are complicated and confusing to customers, and that wireless carriers are taking advantage of the situation by charging a very expensive per-minute rate for voice minutes beyond the monthly usage allowance. This article revisits an emerging database marketing strategy known as rate plan optimization and explores the importance of having customers on suitable rate plans. After conducting research on 11 525 residential customers from a Canadian wireless carrier, it is discovered that 55.4 per cent of them are subscribing to the wrong rate plans and these customers are churning faster than those with optimal ones. This article argues that proactively matching customers to optimal rate plans can contribute to customer churn reduction, although short-term profi tability has to be sacrifi ced by the carriers in order to realize these benefi ts.

No abstract

No abstract