Utilizing customers’ purchase and contract renewal details to predict defection in the cloud software industry

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

3 Citations (Scopus)

Abstract

This study aims to predict customer defection in the growing market of the cloud software industry. Using the original unstructured data of a company, we propose a procedure to identify the actual defection condition (i.e., whether the customer is defecting from the company or merely stopped using a current product to up/downgrade it) and to produce a measure of customer loyalty by compiling the number of customers’ purchases and renewals. Based on the results, we investigated important variables for classifying defecting customers using a random forest and built a prediction model using a decision tree. The final results indicate that defecting customers are mainly characterized by their loyalty and their number of total payments.

Original languageEnglish
Title of host publicationKnowledge Management and Acquisition for Smart Systems and Services - 13th Pacific Rim Knowledge Acquisition Workshop, PKAW 2014, Proceedings
EditorsYang Sok Kim, Byeong Ho Kang, Deborah Richards
PublisherSpringer Verlag
Pages138-149
Number of pages12
ISBN (Electronic)9783319133317
DOIs
Publication statusPublished - 2014

Publication series

NameLecture Notes in Computer Science (including subseries Lecture Notes in Artificial Intelligence and Lecture Notes in Bioinformatics)
Volume8863
ISSN (Print)0302-9743
ISSN (Electronic)1611-3349

Keywords

  • Cloud software industry
  • Customer defection
  • Decision tree
  • Machine learning
  • Random forest

Fingerprint

Dive into the research topics of 'Utilizing customers’ purchase and contract renewal details to predict defection in the cloud software industry'. Together they form a unique fingerprint.

Cite this