Intra-Operator Customer Churn in Telecommunications: A Systematic Perspective

Abstract

Customer churn as a common but extremely harmful phenomenon haunts service operators in telecommunications industry for a long time. Discriminating customers prone to churning in the early stage and taking precaution measures can mitigate customer churn effectively. Unlike previous works which mainly considered the inter-operator customer churn, we focus on a new problem of intra-operator customer churn, that is, customers abandon their fourth generation (4G) mobile communication services and switch to third generation/second generation (3G/2G). Due to quite different mechanisms and causes, previous studies cannot tackle this new problem well. In this paper, we propose a novel profit maximizing framework to solve this special customer churn problem. Specifically, we first build a profit maximizing classifier to predict whether a customer is prone to churn or not, in which profitable customers have more probability to be classified correctly. Then, we describe and quantify the switching behaviors of 4G customers by introducing a notion of switching score. Finally, we investigate relations between operators and customers, finding that some features of 4G service plans provided by operators indeed affect switching behaviors of 4G customers remarkably. This provides insight into reasonable design of 4G service plans for operators in the future. Our framework uncovers the root causes of intra-operator customer churn and solve the problem well. Experimental results based on real data demonstrate the effectiveness of our framework.