Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Save to My Library
Look up keyword
Like this
0Activity
0 of .
Results for:
No results containing your search query
P. 1
Why Contracts

Why Contracts

Ratings: (0)|Views: 0 |Likes:
Published by Ankit Goel

More info:

Published by: Ankit Goel on Jul 03, 2012
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as DOCX, PDF, TXT or read online from Scribd
See more
See less

05/13/2014

pdf

text

original

 
Why contracts?Annual churn rate with contracts: 2 % * 12months = 24%Annual churn rate without contract : 6 % *12 = 72 %The difference is 48%For AT & T with a customer base of approx20.5 million, this would mean that it wouldhave to acquire anadditional of 9.84 millioncustomers at the cost of 3.64 billion tooffset customers lost to the higherchurnrate. ____________________________________________________________________________________Additional customers lost o churn : 48 % *20.5 million = 9.84 m customersAcquisition cost per customer $ 370 percustomerTotal cost of offsetting higher churn rate: $370 * 9.84m = 3.64 billionHence a strong reason to hold customers through contracts regardledd of the customer dissatisfaction. ____________________________________________________________________________________Pricing levelsBreak even analysis

You're Reading a Free Preview

Download
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->