If You Go, I Will Follow … Social Effects on the Decision to Terminate a Service

Abstract

The adoption of new behaviors or new products is often influenced by those closest to us, but customer churn is influenced by social factors as well. An analysis of 1 million customers of a cellular company showed that customers were 79.7 % more likely to defect for each time one of their social neighbors defected. The more a customer communicated with a neighbor and the more characteristics they shared, such as age, gender or status, the more likely the customer was to follow the neighbor in canceling the service. The effect of a neighbor’s defection on a focal customer’s hazard of defection was strongest within the first month and decreased over time. The study shows that companies should take customers’ social networks into account when attempting to predict and manage customer churn. Network-related information can substantially improve analysis of new product adoption, and the same seems true for the field of customer defection.

Perceived value of advanced mobile messaging services

“…In previous research, several approaches have been used to study the behaviour of mobile services users. Some researchers measure the real behaviour of users/consumers by recording their use: for example, Nitzan and Libai (2013) study average monthly use in hours and Polo and Sese (2013) analyse service usage through the mobile credit consumed. Other researchers use a survey asking about individual’s perceptions and intentions to behave in a specific way (e.g.…”