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An Empirical Investigation of Customer Retention: Addressing Unique Challenges in Customer-Firm Relationships

Christodoulopoulou, Angeliki
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Abstract

Effective customer retention is vital to the survival and prosperity of any customer-centric organization. Systematic examination of different aspects of the customer’s relationship with the firm has the potential to provide valuable insights to support retention efforts. However, the nature of the purchasing options and relationship patterns inherent in each industry require managers to shift their focus on varied aspects of the relationship, thus posing unique challenges. One such challenge is examined in the first essay of this dissertation, in a setting where customer-firm relationships are intermittent, with customers being lost to and won back again by the firm. A unifying model for joint estimation of the customers’ second lifetime duration, multiple repeat churn reasons, and heterogeneity in exhibiting a related churn reason is developed to study this relationship. The findings support the existence of a cured group of returning customers, defined as those who are not susceptible to churn due to a repeated reason. Another challenge is examined in the second essay, which involves a setting where the structure of the purchasing options is a combination of contractual and noncontractual services. The complexities and dynamics of the customer-firm relationship and customers’ underlying commitment to it are modeled through a hidden Markov model, incorporating the dependency between the two purchase processes. The findings suggest that contractual and noncontractual purchase behaviors are distinct but interrelated.

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Date
2018-12-10
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Keywords
customer relationship management, second lifetime, repeat churn behavior, integrated purchase setting, contractual and noncontractual purchases, subscription and non-subscription services
Citation
Christodoulopoulou, Angeliki. "An Empirical Investigation of Customer Retention: Addressing Unique Challenges in Customer-Firm Relationships." 2018. Dissertation, Georgia State University https://doi.org/10.57709/13416478
Embargo Lift Date
2019-12-03
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