Customer Churn Identifying Model Based on Dual Customer Value Gap

  • Hou, Lun (School of Management and Economics, University of Electronic Science and Technology of China) ;
  • Tang, Xiaowo (School of Management and Economics, University of Electronic Science and Technology of China)
  • Received : 2008.03.15
  • Accepted : 2009.12.20
  • Published : 2010.09.30

Abstract

The customer churn and the forecast of customer churn have been important research topics for a long time in the academic domain of customer relationship management. The customer value is studied to construct a gap model based on dual customer values; a basic description of customer value is given, then the gaps between products and services in different periods for the customers and companies are analyzed. The main factors that influence the perceived customer value are analyzed to define the "recognized value gap" and a gap model for the dual customer value is constructed. Based on the dual customer gap a con-ceptual model to determine potential churn customers is proposed in the paper.

Keywords

References

  1. Au, W., C. C. Chan, and X. Yao, "A Novel evolutionary data mining algorithm with applications to churn prediction," IEEE Transactions on evolutionary computation 7, 6 (2003).
  2. Buttle, F., Customer Relationship Management, 1st Ed. Massachusetts, USA: Elsevier, 2004.
  3. Hou, L. and X. W. Tang, Multi‐dimensions evaluating system of customer value, In: Frontiers of Systems Research and Applications in China, Beijing, China, (2005), 420‐424 (in Chinese).
  4. Hwang, H., T. Jung, and E. Suh, "An LTV model and customer segmentation based on customer value: a case study on the wireless telecommunication industry," Expert Systems with Applications 26 (2004), 181‐188. https://doi.org/10.1016/S0957-4174(03)00133-7
  5. Kotler, P., Marketing Management, 11th Ed. New Jersey, USA: Pearson Prentice Hall, 2003.
  6. Lapierre, J., "Customer‐perceived value in industrial contexts," Journal of Business and Industrial Marketing 15, 2/3 (2000), 122‐140. https://doi.org/10.1108/08858620010316831
  7. Reichheld, F., "Loyalty‐based management," Harvard Business Review 21, 3/4 (1993), 64‐73
  8. Teemu, Mutanen, Customer churn analysis‐a case study, Research Report, No Vttr0118406.
  9. Van der Haar, J. W., R. G. M. Kemp, and O. Omta, "Creating value that cannot be copied," Industrial Marketing Management 30, 8 (2001), 627‐636. https://doi.org/10.1016/S0019-8501(99)00128-5
  10. Xu, C. and L. J. Meng, "On theoretical research of customer value," Journal of Shanxi Financial University 10 (2004), 23‐28 (in Chinese).
  11. Zeithaml, V. A., "Customer perceptions of price, quality, and value: A meansend and synthesis of evidence," Journal of Marketing 52 (1988), 2‐22. https://doi.org/10.2307/1251446