What is Customer Churn?
Customer churn refers to the phenomenon where customers or subscribers stop engaging with or doing business with a company or service.
In the telecommunications industry, customers have numerous service providers to choose from, making it easy for them to switch from one provider to another. This has led to an annual churn rate of 15-25% in this highly competitive market.
The dataset is a customer churn dataset, containing information about 7,043 customers, with the following key features:
Dataset and file is given here: Click Here
Key Features:
- Customer Demographics:
customerID
: Unique identifier for each customer.gender
: Gender of the customer.SeniorCitizen
: Indicates whether the customer is a senior citizen (1 = Yes, 0 = No).Partner
andDependents
: Whether the customer has a partner or dependents.
- Account Information:
tenure
: Number of months the customer has stayed with the company.Contract
: Type of contract (e.g., Month-to-month, One year, Two year).PaperlessBilling
: Whether the customer uses paperless billing.PaymentMethod
: Payment method used by the customer.
- Services Signed Up:
PhoneService
andMultipleLines
: Whether the customer has phone service and multiple lines.InternetService
: Type of internet service (DSL, Fiber optic, None).- Services such as
OnlineSecurity
,OnlineBackup
,DeviceProtection
,TechSupport
,StreamingTV
, andStreamingMovies
.
- Charges:
MonthlyCharges
: The monthly amount charged to the customer.TotalCharges
: The total amount charged to the customer.
- Customer Interaction:
numAdminTickets
andnumTechTickets
: Number of administrative and technical support tickets raised by the customer.
- Churn:
Churn
: Indicates whether the customer churned (Yes = churned, No = retained).
From a Customer Churn Analysis Perspective:
This dataset can be used to identify patterns or factors influencing customer churn. For example:
- Customers with higher churn rates may have specific contract types, high monthly charges, or a lack of certain services like tech support or online security.
- Senior citizens or customers with shorter tenure could exhibit distinct churn behaviors.
Using this information, strategies can be developed to improve retention by targeting at-risk groups, improving service offerings, or addressing pain points.
From a Customer Risk Analysis Perspective:
This dataset also allows for risk assessment by examining:
- Financial Risk: High-churn customers might pose a financial risk, especially if they contribute significantly to revenue (high TotalCharges or MonthlyCharges).
- Operational Risk: Customers raising numerous
numAdminTickets
ornumTechTickets
might indicate service dissatisfaction or operational inefficiencies. - Behavioral Risk: Customers on month-to-month contracts or without bundled services might be more likely to churn, representing a retention risk.
By integrating predictive models and visualizing the data, businesses can proactively mitigate risks by tailoring retention campaigns or optimizing service quality.