Working with a team of tech-savvy data scientists, business analysts and IT engineers to develop a Capstone project presentation with Python, SQL, Data Storytelling and Tableau within 2 days! We managed to crack the code with data and provide ideas and solutions to better improve the churn rate for Telco!

1. Telco
Churn Rate
Reduction
AEDA Capstone Project
Team 3

2. Objectives
• Measure impact of churn rate to bottom
line
• Identify factors of churning
• Recommendations to reduce churn
• Strategies to improve business
performance

3. Customer Spending
behaviors
B25 – Spender: $191 - $282
M50 – Spender: $282 - $328
T25 – Spender: $328 - $416
Top 6 cities
WV - West Virginia
MN - Minnesota
NY - New York
AL - Alabama
OR - Oregon
WI - Wisconsin
T25:
B25: $191 - $282
M50: $282 - $328
T25: $328 - $416

4. Top 6 reasons for
churning
Snail-like speed Unstable connection
3G/4G/5G
More perks and
rewards from
competitors
Negative customer
experience
Low-cost substitute
from other service
providers
Lack personalization of
feature and services

5. 14.5% of our customer churn. Revenue loss for churned
customers will stack up over time.
Revenue loss = $32,182.28
15.79% of the total revenue
($203,861.67)

6. Churned customers come from these locations.
Predominantly, the locations are located at the 2nd and 3rd
tier cities in the United States of America.
Based on US News on Best
States Rankings, NJ, TX, and
MD are in the 2nd and 3rd
Tier.
Source: https://www.usnews.com/news/best-
states/rankings
NJ – New Jersey
TX – Texas
MD – Maryland
MI - Michigan
MN - Minnesota
Specially for New Jersey
(NJ), their infrastructure is
ranked at 41 out of 50
States in the US.

7. Top cities that have highest churn rate allows us to probe
further on whether there is connection issues in that area, or is
there a better promotion made available by competitors that
causes customers to switch to another service provider.
• Consider checking on connectivity issues or partner with other telco
provider to ensure that the connection is stable.
• Check on marketing and promotions offered by telcos dominating that
areas to see if there is hyper-localized content to drive brand awareness
and promotions.
• Consider dynamic pricing strategy for customers at different localities
and different spending tiers.
• Customer demographics and usage behaviour might be different in these
cities, probe further to develop better strategies for retention.

8. Further customer segmentation can be developed to reduce
churn rate. Prioritize customer segments in the order of: T25,
B25, followed by M50.
14.18
% 7.67%
28.45%
2X from B25
3.7X from M50
WHY??
HIGHER expectation
PERSONALIZED service
DEMANDING nature
LOW COST switching
2X 3.7X
T25
B25 M50

9. Churned customers significantly shows bimodal
distribution. Further analysis can be done to analyze
customer demographics of the two groups to identify key
factors of churning.
bimodal
bimodal
bimodal

10. Churning customers shows distribution towards the
right of the non-churned customers. i.e longer callers,
and higher spending customers shows higher
tendency of churning.

11. Churned customers (collectively) spend 50.74 minutes
more time on calls than non-churned customers. They
spend 10.6% more than non-churned users.

12. VIP and premium customer service to retain top
spenders in the T25 category.
• Offer better perks and rewards to VIP customers who stay with us for
longer period.
• Partner with lifestyle brands to offer better promotions, and engaging
activities to keep customers happy.
• Set up dedicated team to service VIP customers
• Personalized content, plan, promotions, and packages to communicate
and engage with this group of customers.
• Consider bundle packages with business-related/international calls/ voice
calls i.e ALL-IN-ONE package for this group of customers.

13. Critical improvement to ensure that customers issues
are resolved by the 3rd connection. Frustrated
customers are prone to churn when they need to call
for 4 times or more.
10.2
45.7
4X

14. Ramp up customer service for faster response and shorter duration
for issue resolution. Personalized customer service and automate
systems and processes leveraging technologies such as bots, AI
without losing human touch are key to success.
• Improve SLA to solve issues with different severity.
• Manage customer’s expectations on delivery / issue resolution
• Consider automation with bot / AI-voice-assisted customer service system to get
issues resolved quicker while engaging customers
• Further investigation on: correlation with Net Promoter Score (NPS) and
Customer Satisfaction Score (CSAT), Dropped-Call-Rate (DCR) and Time Taken
to Fully Resolved an Issue to further investigate and validate the issues.
• Is customer service team having enough people to handle calls? Issue
escalation time can be shorter?

15. Almost all the churned customers have high volume of
voice calls (more than 15). Probe further to segment
and identify this group of customers.

16. Voice calls with high volume could be due to
• Located at out-of-service areas
• Businesses or marketers handling large volume of customers inquiries
• Offer value-added services to help them manage the voice calls.
• Closely monitor customers with voice call plans to identify tendency of churn

17. Never overlook international calls. International callers
shows 3.6x higher tendency of churning.
42.41%
11.50%
3.6X
Insights: Achieving the sweet spot between quality
and charges is key to success.
- Quality of International Plan
- Quality vs Charges

18. Delight international callers with stable connection and lower
rates.
• Cross-border partnership with international telco service provider
• Partner with infrastructures providers to ensure quality of 3G/4G/5G coverage
• Closely monitor international call plan subscribers
• Are they frequent flyers? Consider partnership with travel services and airlines
for retention strategies.

19. Retention Strategies
Customer segmentation
Dynamic pricing
VIP customers
Mass personalization
Better service
Voice callers
International callers
Competitor monitoring
ALL in ONE bundle
Shorter resolution
Faster response
Automation with human touch
Marketing/Promotion
Product bundling

20. Cluster Sampling for further investigation
250 customers from Churned vs. Non-churned pool from 5
states.

21. Cluster Sampling for further investigation
# Count the percentage of Churned users in the population and save the result as pop_churn_pcnt
pop_churn_pcnt= pd.read_sql_query("SELECT Churn as [Churn type], count(churn) as [total
churn], (select count(*) from population) as [total record], round(cast (count(churn) as float)/cast
((select count(*) from population) as float) * 100,1) as percentage FROM population group by
churn",conn)
pop_churn_pcnt

22. Cluster Sampling for further investigation
smp_churn_pcnt= pd.read_sql_query("SELECT Churn as [Churn type], count(churn) as [total
churn], (select count(*) from sample) as [total record], round(cast (count(churn) as float)/cast
((select count(*) from sample) as float) * 100,1) as percentage FROM sample group by
churn",conn)
smp_churn_pcnt