The influence of customer churn and acquisition on value dynamics of social neighbourhoods

Authors: Kazienko, P., Bródka, P. and Ruta, D.

Journal: Lecture Notes in Computer Science (including subseries Lecture Notes in Artificial Intelligence and Lecture Notes in Bioinformatics)

Volume: 5736 LNAI

Pages: 491-500

eISSN: 1611-3349

ISBN: 9783642047534

ISSN: 0302-9743

DOI: 10.1007/978-3-642-04754-1_50

Abstract:

The customers of modern telecommunication service providers implicitly create an interactive social network of individuals, which both depend on and influence each other through various complex social relationships grown on friendship, shared interests, locality, etc. While delivering services on the individual basis, the social network effects exerted from customer-to-customer interactions remain virtually unexplored and unexploited. The focus of the paper is on customer churn and acquisition, where social neighbourhood effects are widely ignored yet may play a vital role in revenue protection. The key assumption made is that a value loss or gain of a churning or new customer extends beyond the revenue stream and directly affect interaction within local neighbourhoods. This influence is evaluated experimentally by direct measurements of the total neighbourhood value of the churning customer taken before and after the churn event. © 2009 Springer Berlin Heidelberg.

Source: Scopus