Increasing customer retention using AI & machine learning

The Project

We worked closely with a large Original Equipment Manufacturer (OEM) to build sophisticated AI and machine learning algorithms and enhance their customer retention strategy.

The Challenge

The OEM had low customer retention rates (<10%) and they needed assistance with developing a more effective customer retention strategy.  Previously, the business had tried to retain customers by calling potential customers through their internal operations and retention departments, however many of the customers were disinterested and therefore conversion rates were low.

 The Solution

The solution involved building multiple retention models classifying customers into High, Medium and Low categories to allow the business to prioritise the customers they would like most to retain. The models leveraged Finity’s leading Defin’d household socio-demographic database in conjunction with the clients’ own customer level data.

The models included termination modelling, attrition modelling, likelihood of retention modelling using both internal and external data sources. The project also involved assisting with the integration into sales automation, marketing and decision hubs in PEGA as well as the implementation of retention reporting, internal and external processes, policy, data sourcing and modelling and deployment an ongoing model maintenance.

The Business Impact

The overall impact of our solution, by focusing on the High retention customers has led to business savings in excess of $250k in operations costs as well as the customer retention rate increasing by 72% from April 2020 to December 2021.