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Research Trends in Customer Churn Prediction: A Data Mining Approach

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Trends and Applications in Information Systems and Technologies (WorldCIST 2021)

Part of the book series: Advances in Intelligent Systems and Computing ((AISC,volume 1365))

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Abstract

This study aims to present a very recent literature review on customer churn prediction based on 40 relevant articles published between 2010 and June 2020. For searching the literature, the 40 most relevant articles according to Google Scholar ranking were selected and collected. Then, each of the articles were scrutinized according to six main dimensions: Reference; Areas of Research; Main Goal; Dataset; Techniques; outcomes. The research has proven that the most widely used data mining techniques are decision tree (DT), support vector machines (SVM) and Logistic Regression (LR). The process combined with the massive data accumulation in the telecom industry and the increasingly mature data mining technology motivates the development and application of customer churn model to predict the customer behavior. Therefore, the telecom company can effectively predict the churn of customers, and then avoid customer churn by taking measures such as reducing monthly fixed fees.

The present literature review offers recent insights on customer churn prediction scientific literature, revealing research gaps, providing evidences on current trends and helping to understand how to develop accurate and efficient Marketing strategies. The most important finding is that artificial intelligence techniques are are obviously becoming more used in recent years for telecom customer churn prediction. Especially, artificial NN are outstandingly recognized as a competent prediction method. This is a relevant topic for journals related to other social sciences, such as Banking, and also telecom data make up an outstanding source for developing novel prediction modeling techniques. Thus, this study can lead to recommendations for future customer churn prediction improvement, in addition to providing an overview of current research trends.

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Acknowledgments

This work is partially funded by national funds through FCT - Fundação para a Ciência e Tecnologia, I.P., under the project FCT UIDB/04466/2020

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Authors and Affiliations

  1. Instituto Universitário de Lisboa (ISCTE-IUL), ISTAR, Lisbon, Portugal

    Zhang Tianyuan & Sérgio Moro

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  1. Zhang Tianyuan
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  2. Sérgio Moro
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Editors and Affiliations

  1. ISEG, University of Lisbon, Lisbon, Portugal

    Álvaro Rocha

  2. College of Engineering, The Ohio State University, Columbus, OH, USA

    Hojjat Adeli

  3. Institute of Data Science and Digital Technologies, Vilnius University, Vilnius, Lithuania

    Gintautas Dzemyda

  4. DCT, Universidade Portucalense, Porto, Portugal

    Fernando Moreira

  5. Department of Information Sciences, University of Sheffield, Lisbon, Portugal

    Ana Maria Ramalho Correia

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Tianyuan, Z., Moro, S. (2021). Research Trends in Customer Churn Prediction: A Data Mining Approach. In: Rocha, Á., Adeli, H., Dzemyda, G., Moreira, F., Ramalho Correia, A.M. (eds) Trends and Applications in Information Systems and Technologies. WorldCIST 2021. Advances in Intelligent Systems and Computing, vol 1365. Springer, Cham. https://doi.org/10.1007/978-3-030-72657-7_22

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