EMPERIO Marketing Lab
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Diagnose subscriber churn in Chennai

Chennai, Tamil Nadu · Fictional practice case

The decision

A membership opens with 2,000 subscribers, loses 120 and adds 150. It earns ₹180 monthly contribution per active subscriber. For a new cohort the first three monthly survival rates are 100%, 94% and 88%. CAC is ₹400.

How much headroom does the cohort have, and what churn should be tackled?

Worked solution

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Case at a glance
Opening-cohort churn · 6%. Three-month contribution · ₹507.60. After CAC · ₹107.60
  1. Monthly churn is 120 ÷ 2,000 = 6%. New subscribers do not reduce the churn denominator. Separate payment failures from intentional cancellations.
  2. Use cohort survival to estimate undiscounted contribution: ₹180 × (1 + .94 + .88) = ₹507.60. After acquisition, headroom is ₹107.60 for the stated period.
  3. Test payment reminders separately from service changes. Compare recovered contribution with the cost of each treatment.

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