June 28, 2023
TLDR: After migrating to gaiia, oxio successfully decreased their customer churn rate from 1.9% to 1.4%, representing a 25% improvement. Additionally, the onboarding experience became stronger and simpler, with 'Activation Churn' decreasing from 11% to 7%. The seamless onboarding experience, coupled with an easy-to-use client portal, played a crucial role in reducing churn and improving customer satisfaction.
oxio is a digital-first ISP in Canada known for its commitment to exceptional customer experience, transparent pricing, and accessible internet services. As Canada's fastest-growing ISP, oxio has rapidly scaled its customer base from 0 to 50,000 subscribers, while maintaining an average rating of 4.7/5 stars on planhub.ca. It has been recognized as Canada's best-loved ISP, offering customer service in both English and French across three different time zones.
At peak growth, oxio was acquiring over 140+ new customer per day, with an average churn rate of 1.9%. With their scale, any improvements in reducing churn would significantly improve revenue growth and EBITDA.
oxio also offers a 60-day money back guarantee, no cancellation fees, and no contracts - a truly unique and refreshing customer experience in the Canadian market. However, the flexibility offered by oxio makes it extremely simple for customers to cancel & switch internet providers at any time…. which can be detrimental to churn rates and ultimately bottom line if the end customer isn’t extremely satisfied with their internet provider.
A churn rate of 1.9% at 50,000 subscribers translates to approximately 950 customers per month & 11,400 customers churning annually. At a $55/month ARPU, 950 customers churning per month equates to almost $4.1M of lost revenue over a 12 month period.
The average monthly churn rate for a typical ISP in the US can vary depending on various factors such as market conditions, competition, customer demographics, and service quality. However, industry reports and studies suggest that the average monthly churn rate for ISPs in the US typically ranges from 1% to 3%.
Upon analyzing the reasons behind customer churn, several key factors emerged. One primary cause was customers relocating to new residences. When customers moved to different locations, they often faced challenges in transferring their internet service, resulting in frustration and the decision to seek alternative providers. The lack of a smooth transition process increased the likelihood of churn in these cases.
Additionally, a portion of customers churned due to difficulties in getting their service set up properly. Whether it was delays in installation or technical issues during the initial stages, these obstacles led to a negative customer experience and contributed to the churn rate. When oxio analyzed their ‘activation churn’ (Customers who unsubscribed within 30 days of signing up) they found it was nearly 11%, which was most significant factor driving the 1.9% total churn rate.
Some customers also expressed a desire to change their plans or upgrade their internet speeds, but found the process cumbersome or restrictive. The inability to easily modify their subscriptions according to their evolving needs prompted them to consider alternative providers, resulting in churn.
To tackle the challenge of customer churn, oxio implemented strategic initiatives and leveraged gaiia's comprehensive platform to enhance the customer experience, streamline processes, and reduce churn rates. The following strategies & solutions were implemented…
In order to reduce the amount of new customers who unsubscribed within the first 30 days (11% 🤯), oxio recognized the importance of revamping their customer onboarding process, and decided to leverage gaiia’s fully integrated & customizable online checkout (Read more about how oxio leveraged gaiia’s Checkout to increase conversion rate by 6x here).
Below are specific examples of how the online checkout automated a new customer activation in the backend, and resulted in more customers being activated & happy with their service within the first 30 days:
Based on the customers location & Network Integration, the gaiia checkout was able to determine if a technician was required for installation. If a technician was required, oxio was able to sync the technician’s calendar to the checkout and allow the customer to select from available dates & times.
In the backend, gaiia automatically allocates and reserves the appropriate equipment from inventory, creates a shipping label, and drops the order to oxio’s 3PL partner to ship the equipment. Ensuring that the new customer gets the proper equipment (no human error) & is kept up to date with a shipment tracking number and link.
Within the checkout experience oxio was able to display additional products & services that customers may be interested in. For example, oxio allowed customers to add multiple routers to their subscription and suggested customers do so if their residence was above a certain square footage. This resulted in customers with larger residences adding an additional router & having a stronger wifi signal throughout their house from the start of their time with oxio, and ultimately less reason to seek alternative providers.
To better address existing customers who wanted to update something about their current subscription (i.e. location, speed, billing info, etc) oxio publicly launched a client portal using gaiia. The client portal empowered customers to make changes to their plans, such as upgrading their internet speeds or modifying their subscription details, with ease and convenience. By offering self-serve options through the client portal, oxio enhanced the overall customer experience and eliminated potential obstacles that could lead to churn. Specific examples are highlighted below:
Recognizing that customer relocations often resulted in churn, oxio enabled customers to simply enter their new address, date of move, and when they will be available for a technician to help install (if required). Submitting the online webform triggered all necessary workflows in the gaiia backend, and ensured a seamless transition for the customer in their move. The streamlined relocation process included proactive communication, assistance with scheduling installations, and personalized support to address any challenges customers might encounter during the transition. By prioritizing relocation support, oxio retained customers who were changing residences and reduce churn resulting from the moving process.
To address the need for plan modifications and upgrades, oxio introduced flexible options for customers. With gaiia's support, oxio allowed customers to easily modify their subscriptions, including changing their plans or upgrading their internet speeds, through the client portal. This flexibility empowered customers to align their subscription with their evolving needs without cumbersome procedures or restrictions. By providing a hassle-free process for plan modifications, oxio retained customers who sought greater flexibility and minimized churn resulting from dissatisfaction with their existing plans.
By implementing these solutions, oxio aimed to enhance the customer experience at various touch points, address the key reasons behind churn, and provide customers with the necessary tools and support to remain satisfied with their internet services. The focus on seamless onboarding, customer-centric self-service, relocation support, and plan flexibility aimed to reduce churn rates, increase customer retention, and foster long-term customer loyalty.
Activation Churn represents the percentage of customers who churn within 30 days of signing up. Prior to the implementation, oxio faced an Activation Churn rate of 11%. However, with the introduction of the seamless onboarding experience, customer-centric client portal, and enhanced relocation support, the Activation Churn rate decreased to 7% (a 36% improvement). This decrease indicated that customers were more satisfied and engaged with oxio's services right from the start, resulting in a higher likelihood of long-term retention.
Prior to implementing the solutions, oxio faced a churn rate of 1.9% among its customer base. However, after optimizing the onboarding experience, implementing the customer-centric client portal, and enhancing relocation support and plan flexibility, the churn rate dropped significantly. The updated churn rate decreased to 1.4%, representing a 25% improvement in customer retention. This reduction in churn demonstrated the effectiveness of the implemented solutions in keeping customers engaged and satisfied with oxio's services.
To understand the significance, let's consider a baseline of 50,000 subscribers. With a 1.9% churn rate, oxio would lose approximately 950 subscribers monthly. However, by reducing the churn rate to 1.4%, the number of lost subscribers decreased to 700, resulting in 250 fewer customers churning each month.
If we simplify the math → Over a 12-month period 250 customer x 12 months = 3,000 additional customers retained…. at an average ARPU of $55 ($55 x 3,000 Subscribers), oxio can account for $165,000 of additional monthly reoccurring revenue still coming in.
By providing a seamless onboarding experience, a user-friendly client portal, and comprehensive support during relocations and plan modifications, oxio significantly improved overall customer satisfaction and loyalty. Customers appreciated the ease of signing up, the convenience of managing their subscriptions, and the personalized support they received. See for yourself the 580+ customer reviews on Planhub & oxio's Digital Experience rating.
With gaiia's integrated platform, oxio's customer service team was able to handle rapid customer growth, deliver personalized service, and become Canada's best-loved ISP. As a result of these integrations, oxio not only decreased churn by 25%, but also enhanced customer support capacity by 29%, read more about how oxio increased CSR efficiency here.
June 28, 2023
