Management Science · 1987 · 643 citations · 17 references
Marketing AnalyticsCustomer SatisfactionCustomer ExperienceCustomer ProfilingConsumer ResearchBusiness AnalyticsData ScienceGrowth RateNew ProductManagementRepeat PurchasesCustomer InvolvementMarket SegmentationStatisticsQuantitative ManagementPromotion (Marketing)MarketingCustomer Journey AnalysisInteractive MarketingBusiness
The issue is important for monitoring firm growth, evaluating product success, and targeting customers for advertising. The article aims to count and identify customers who remain active by developing a model based on their prior transaction counts and timing. The model uses the number and timing of past transactions, and its application is demonstrated through several numerical examples. The model enables calculation of each customer's probability of remaining active.
This article is concerned with counting and identifying those customers who are still active. The issue is important in at least three settings: monitoring the size and growth rate of a firm's ongoing customer base, evaluating a new product's success based on the pattern of trial and repeat purchases, and targeting a subgroup of customers for advertising and promotions. We develop a model based on the number and timing of the customers' previous transactions. This approach allows computation of the probability that any particular customer is still active. Several numerical examples are used to illustrate applications of the model.
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