A framework for identification of high-value customers by including social network based variables for churn prediction using neuro-fuzzy techniques

Customer churn has become a significant problem and is one of the prime challenges that many in the services industry are facing. While all kinds of churn lead to incur loss, the loss of low-value customers will be naturally less damaging than the loss of loyal and high-value ones. So companies need to build a churn prediction model for their high-value customers. In this paper, a two-phase framework for prediction of high-value customer churn has been proposed. Phase 1 is the identification phase which takes into account social-network based variables of customers in identifying the high-value ones. The data of an identified high-value customer is used as the input for Phase 2 to prepare the churn prediction model. Data of a major telecommunication company has been used to implement the framework. The customers were clustered by using K-means algorithm. After ranking clusters, the top-cluster was selected according to clusters ratings. The data belonging to the top cluster is used in churn prediction mod...