Just-in-time customer churn prediction in the telecommunication sector

Abstract

Due to the exponential growth in technologies and a greater number of competitors in the telecom sector, the companies are facing a rigorous problem of customer churns. The customer churn is a phenomenon that highlights the customer’s intention who may switch from a certain service or even the service provider company. Many customer churn prediction (CCP) techniques are developed by academics and practitioners to handle the customer churn in order to resolve the problems pertaining to customer retention. However, CCP is not widely studied in the scenario where the company is not having enough historical data due to either been a newly established company or due to the recent start of a new technology or even because of the loss of the historical data. The just-in-time (JIT) approach can be a more practical alternative to address this issue as compared to state-of-the-art CCP techniques. Unfortunately, similar to traditional churn prediction models, JIT also requires enough historical data. To address this gap in the traditional CCP models, this study uses the cross-company data, i.e., data from another company, in the context of JIT for addressing CCP problems in the telecom sector. We empirically evaluated the performance of the proposed model using publicly available datasets of two telecom companies. It is found from the empirical evaluation that in the JIT-CCP context: (i) it is possible to evaluate the performance of the predictive model using cross-company dataset for training purposes and (ii) it is evident that heterogeneous ensemble-based JIT-CCP model is more suitable approach to use as compared to individual classifier or homogeneous ensemble-based technique.