What is 'churn management'?

Caty,

I believe Brad certainly nailed it with "It is simply the identification of those customers who are likely to churn - or take their business elsewhere - and proactively taking action to prevent those deemed to be the most valuable from doing so."

Once you have identified customers who are likely to churn, managing your churn rate would include identifying why those customers are churning and then proactively taking steps not only to try and win them back (if they are profitable to your business) but also creating new processes and procedures internally to help offset future churn.

I think some of the best work on "Churn management" begins by re-conceiving your business: the value of your company is the sum of all of the profits and losses of all of the customers with whom you do business. Not a formal nor "pretty" answer, but one that the CFO can work with, believe it or not: it recognizes that a company has a portfolio of customers. that portfolio can be managed actively. Moreover, there are tools and customer insight "practices" that can be overlain which allow a further insight - one such analytical approach is to do a 5 year buyer behavior analysis. Next, to get a sense of how this would work: take a peek at Jill Girffin's book, "Customer Win-Back". She was kind enough to include a sample of this buyer behavior analysis and from there, you are off and running. A great way to optimize your coverage model and to proactively invest in your customers in direct proportion to your expected return on that investment.
Last thing, tho': you need to "define a customer" for this really to have traction. and, this works magnificently in the B2B world and may be overwhelming to large B2C firms - can't say for sure.

One of the most pressing problems for businesses in today's competitive markets is Customer churn (or Attrition). Yet at the same time they're faced with new customer acquisition costs higher than ever before. That's why Churn management - identifying likely churners and taking the right action to keep the most valuable - has risen to the top of corporate agendas everywhere. Churn management centers on answering key questions like:

Which customers are most likely to churn? A key element of churn management is identifying ahead of time (churn prediction) which customers may be considering leaving.
How can we persuade them to stay? All customers will respond differently to retention offers. Churn management works across different markets and customer segments to identify which offers are most appropriate for each and every customer.
Which customers will stay (churn retention)? It's important that retention efforts are targeted at those potential churners most likely to react positively. Churn management identifies customers at most risk of churning and who are most likely to respond well to the right retention offer made in the right way.