TRG Associates President John Brady discusses the latest attrition results and related topics of TRG and Central Station Alarm Association’s (CSAA) Attrition Measurement Study.
Each year TRG Associates Inc. and the Central Station Alarm Association (CSAA) collaborate to produce the Attrition Measurement Study. The report aims to measure the number of customer RMR losses (gross attrition) and the offsets to those losses through resigning like customers/locations and other increases in the RMR related to the same base of customers (net attrition). At press time, TRG President John Brady was finalizing data for the 2012 survey. He joins the conversation to discuss the latest attrition results and related topics.
What stands out for you in the 2012 Attrition Measurement Study?
We are going to finally eclipse $200 million in recurring monthly revenue. In fact, we are going to have more than $250 million worth of RMR reported to the study. The beauty is that total doesn’t include ADT. Now that they are a standalone company they are far more forthcoming with their key metric information. We already know on the residential side that they were $252 million. Put that on top of what independent dealers reported and it really gives everyone a good feel what went on in 2012.
Should dealers be tracking both gross and net attrition rates?
Yes, absolutely. The difference between gross attrition and net attrition is absolutely the measurement of each management team and their focus on customer retention. If you don’t measure it, you can’t manage it. It is absolutely vital that you measure both, but it’s even more critical that you put in a system to understand the reason for the cancellation. Find out why the customer is leaving. Was it poor service? Did a competitor take them? Is it because they are no longer using the system? Are they moving? Every reason helps management analyze what they have done wrong and start to figure out how to regain that RMR.
Article Published By Rodney Bosch of TRG Assicated on Security, Sales & Integration, July 1, 2014
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