 to prevent the churn from initially occurring. The second is reactive churn management. This category includes all those actions that attempt to correct or compensate for the churn that has begun to occur, or churn events that ate already underway. Chapter 6 PREEMPTIVE CHURN MANAGEMENT From the provider's perspective, there are two ways that the rate of churn can be affected. The first way is to eliminate or minimize customers' dissatisfaction. If the customers are already receiving the best price, the best service, the desired call quality and coverage, and these customers are associated with a firm whose brand image is appealing to them, then churn will not occur. A company's attempts to prevent churn through the proactive satisfaction of customer churn reasons is preemptive churn management. The Economics of Preemptive Churn Management At first glance, the idea of trying to prevent churn opportunities from occurring makes sense. Imagine positioning yourself SO you do not have to worry about your customers switching despite all your competitor's efforts to try and lure your customers away from you. While this thought process seems appealing, there are some economic realities to consider. Pre-emptive churn management will cost the firm money. There are expenditures for improving customer service, call quality, and coverage. These expenditures often come in the form of the reduced prices that you will have to offer your customers SO that you are able to compete in the market. There are also marketing and advertising expenditures to ensure that your brand image and reputation remain intact and on par or better than your competition's image. These expenditures can quickly add up to a lot of money, and a company cannot afford to "churn proof" all of its customers in this fashion. Of course, the other consideration, which we will examine further, is that no company should want to pay to keep all of its customers. Reasons for NOT Blanket Churn-Proofing There are several reasons why attempting to churn-proof your enti