A Multi-agent Simulation Paradigm of Customer Retention Management

Abstract

Customer retention is one of the most important topics in customer relationship management research. To date, customer retention studies are mainly carried out on the macro or firm level instead of the individual customer level. This study develops a model of customer retention management from the individual customer perspective. This model introduces multiple agents and considers the interactions among these individual agents (firms and customers). Specifically, to establish this multi-agent simulation paradigm, the paper uses customer trigger threshold, customer competence increment and stimulus-behavior mechanism to model micro customer behaviors, and then relates the customer behaviors with the customer retention/acquisition shares of the firms