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Article
Publication date: 4 June 2010

Steffen Zorn, Wade Jarvis and Steve Bellman

As acquiring new customers is costly, putting effort into satisfying and keeping customers over the long term can improve profitability. Firms usually do not know how each…

Abstract

Purpose

As acquiring new customers is costly, putting effort into satisfying and keeping customers over the long term can improve profitability. Firms usually do not know how each individual customer is feeling at any time (their attitude to the firm), so typically a customer's likelihood of leaving (“churning”) is predicted from behavioural data. The purpose of this paper is to investigate how a firm can add attitudinal variables to these churning models by deriving proxy indicators of satisfaction and commitment from behavioural data. The paper tests whether adding these proxies improved predictions of churning compared to a typical model based on purchasing behaviour (PB).

Design/methodology/approach

Analysing data from 6,000 regular customers from an Australian digital versatile disc rental company, logistic regression predicted membership termination (i.e. churning=1) versus continuation (=0). A baseline model used three traditional behavioural variables directly linked to members' PB. A second model including proxies for satisfaction and commitment from the customer database was compared against the baseline model to investigate improvement in churn prediction.

Findings

The most significant predictor of churn is an indicator of commitment: the uncertainty of a customer's commitment, indicated by number of times they changed their subscription plan.

Practical implications

The more customers change their plan, the more likely they are to quit the relationship with the firm, most likely because they are uncertain about how they can benefit from a long‐term commitment to the firm. Monitoring uncertainty indicators, such as plan changing, allows firms to intervene with special offers for uncertain customers, and, therefore, increase the likelihood of them staying with the firm.

Originality/value

The paper discusses the use of customer behaviour recorded in databases to identify proxy indicators of attitude before this attitude translates into churning behaviour.

Details

Journal of Research in Interactive Marketing, vol. 4 no. 2
Type: Research Article
ISSN: 2040-7122

Keywords

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Article
Publication date: 27 September 2013

Ahmad Fareed Ismail, Steffen Frank Zorn, Huey Chern Boo, Sambasivan Murali and Jamie Murphy

The purpose of this paper is to investigate how three organizational factors – affiliation, sufficient capital and company age – related to 323 Malaysian foodservice…

Abstract

Purpose

The purpose of this paper is to investigate how three organizational factors – affiliation, sufficient capital and company age – related to 323 Malaysian foodservice companies' diffusion of six information technology (IT) applications. The IT applications, basic or advanced, respectively, represent two innovation diffusion levels, adoption and implementation.

Design/methodology/approach

This study drew on a survey of chief executive officers, owners, information system/technology managers, operations managers, and account/financial managers in 323 Kuala Lumpur and Selangor foodservice companies. The study conducted logistic regression to examine factors related to the adoption and implementation of IT applications.

Findings

IT adoption and implementation related significantly to sufficient capital. Company age and affiliation showed an insignificant relation with adopting and implementing IT applications.

Originality/value

To the authors' knowledge, this is the first hospitality study to examine simultaneously the diffusion of basic and advanced IT applications. Most studies investigate the adoption of one or two innovations, such as spreadsheets, web sites, and e‐mail, without considering diffusion stages. This study demonstrates multiple innovations, multiple diffusion stages and multivariate analyses.

Details

Journal of Hospitality and Tourism Technology, vol. 4 no. 3
Type: Research Article
ISSN: 1757-9880

Keywords

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Article
Publication date: 1 March 2008

Jun Peng

The surging stock market in the late nineties lifted the funding level of most pension plans and led to plan management decisions that left them vulnerable to the stock…

Abstract

The surging stock market in the late nineties lifted the funding level of most pension plans and led to plan management decisions that left them vulnerable to the stock market decline of 2000-2002. In this study, an analysis was conducted on the descriptive data of 51 state pension plans for the period 1998-2003 and it was found that overfunded plans were more likely to substantially increase benefits while simultaneously reduce contributions. This led to widespread underfunding and a need for sudden increase in contributions as market conditions grew worse and funding levels dropped sharply. This investment cycle emphasizes the need for more prudent surplus management strategies to protect pension plans from the consequences of stock market volatility.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 20 no. 1
Type: Research Article
ISSN: 1096-3367

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