that the customer generated. Reports based on those numbers are easily created from the monthly billing records. Multiple Forms Of Revenue For the more sophisticated analysis, several forms of the customer's revenue can be taken into account. For example, you might want to compare the billed amount to the paid amount to see how much the customer accrued in revenue versus how much was actually paid. Breakdown by Product/Feature/Function For the truly sophisticated analysis, the analyst will want to see how the revenue generated breaks down by each product, phone line, feature, and function that the customer carries. This, of course, can be much more difficult to acquire based on the nature of the billing system and the way that revenue numbers are initially captured and used. Segmentation by Buying Behavior To develop segmentation schemes based on the revenue and sales numbers collected, the analyst needs to do is establish value ranges and then figure out which customers fit into which range. For Customer Spending per Month Segment assigned $0.00 $25.00 $25.01 $50.00 Medium $50.01 $75.00 $75.01 $100.00 Silver $100.01 $150.00 $150.01 $1,000.00 Platinum Figure 11-7: Segmentation by Revenue eXcellence in Telecommunications The Telco Churn Handbook example, a typical analyst's approach will be to divide customer revenue into five or six dollar-amount ranges and then assign names to each segment. Figure 11-7 shows how customers are divided into the Low, Medium, High, Silver, Platinum, and Gold categories based on their average spending per month. Revenue Segmentation - Most Common Segmentation Used in the Telecommunications Industry Interestingly, I have found that a segmentation strategy by rev- enue amounts, as illustrated here, is the single most common form of segmentation used almost universally by telecommunications companies around the world. Revenue segmentation, clearly, has attained this popularity because it is easy to do and understand and helps people prioritize their decisions Utilization Behavior There 