t to expire soon. There are no such things as retention sales campaigns, and there are no commissions paid to a salesman who convinces a customer not to churn. But a commission will be paid for the reacquisition of a customer who has left. So the salesman calls the customer and says, "Listen, you call up and cancel your subscription, and I will give you a new account with better rates. Ok?" What customer would not go for that deal? So, the sales force reports good sales acquisitions, and the company reports huge churn. Chapter 6 What Is Wrong with That? You might wonder what is SO bad about this approach. We have some churn, but it is actually just a loyalty campaign. Isn't it? The answer is yes and no. Yes, you are keeping the customers and so, in effect, it is not really churn. No, if you are including expensive gifts or subsidized handsets as a part of the reacquisition deal. Then there is a very good chance that this reacquisition will cost you more money than the customer will bring in as revenue. This approach can be very expensive. Mixed Messages, Poor Returns These two examples are extreme views of what can happened when telcos attempt to manage churn. What is much more likely is that the telco ends up sending two, three, or more different messages to the customer at different times. This bombardment of customers with inconsistent messages will produce the following impressions: The company doesn't know what they are doing. They do not value me as a customer. 3. If I wait a little while, they will probably offer me some- thing even better. A SYSTEMATIC APPROACH TO CHURN ISSUES It should be extremely obvious that any kind of churn management strategy that consists of a number of unrelated and uncoordinated activities will be doomed to failure in the long run. These short- term solutions do little to actually impact churn. More importantly, they leave executives and investors more confused than ever about the true nature of the telecommunications marketplace and what the true marketplace strength of the pro