TY - JOUR
T1 - Timing customer reactivation initiatives
AU - Holtrop, Niels
AU - Wieringa, Jaap E.
N1 - Publisher Copyright:
© 2023 The Author(s)
PY - 2023/9
Y1 - 2023/9
N2 - Firms operating in non-contractual settings apply customer reactivation initiatives such as email messages to stimulate customers who have become inactive temporarily or permanently to resume their transaction activities. Thus, firms need to know which customers are inactive, and when a customer becomes inactive. Existing approaches struggle to distinguish active from inactive customers and do not provide time-scale estimates of when to send reactivation mails. To address these shortcomings, we develop an approach to target and time the sending of reactivation mails. Building on control chart methods, we introduce a gamma–gamma control chart, modelling the average customer interpurchase time and the variation therein to determine activity boundaries. Crossing these boundaries signals a potential change in a customer's purchasing activity, providing a signal to initiate customer reactivation. A field experiment in the greetings and gifts industry, supported by several additional analyses, illustrates the improved performance of our approach when it comes to signaling customer activity against a wide range of competing models. The improved performance of our method occurs particularly in settings where customers vary strongly in purchase and inactivity patterns.
AB - Firms operating in non-contractual settings apply customer reactivation initiatives such as email messages to stimulate customers who have become inactive temporarily or permanently to resume their transaction activities. Thus, firms need to know which customers are inactive, and when a customer becomes inactive. Existing approaches struggle to distinguish active from inactive customers and do not provide time-scale estimates of when to send reactivation mails. To address these shortcomings, we develop an approach to target and time the sending of reactivation mails. Building on control chart methods, we introduce a gamma–gamma control chart, modelling the average customer interpurchase time and the variation therein to determine activity boundaries. Crossing these boundaries signals a potential change in a customer's purchasing activity, providing a signal to initiate customer reactivation. A field experiment in the greetings and gifts industry, supported by several additional analyses, illustrates the improved performance of our approach when it comes to signaling customer activity against a wide range of competing models. The improved performance of our method occurs particularly in settings where customers vary strongly in purchase and inactivity patterns.
KW - Control chart
KW - Customer base analysis
KW - Customer reactivation
KW - Field test
KW - Non-contractual setting
UR - http://www.scopus.com/inward/record.url?scp=85163137864&partnerID=8YFLogxK
U2 - 10.1016/j.ijresmar.2023.05.001
DO - 10.1016/j.ijresmar.2023.05.001
M3 - Article
AN - SCOPUS:85163137864
SN - 0167-8116
VL - 40
SP - 570
EP - 589
JO - International Journal of Research in Marketing
JF - International Journal of Research in Marketing
IS - 3
ER -