The customer loyalty model in Example 16.7 assumes that once a customer leaves (becomes disloyal), that customer
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From then on, at the end of any year when the customer was loyal, this customer remains loyal for the next year with probability equal to the retention rate. But at the end of any year the customer is disloyal, this customer becomes loyal the next year with probability equal to the rejoin rate. During the customer’s nth loyal year with the company, the company’s mean profit from this customer is the nth value in the mean profit list in column B. Keep track of the same two outputs as in the example, and also keep track of the number of times the customer rejoins.
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Related Book For
Data Analysis and Decision Making
ISBN: 978-0538476126
4th edition
Authors: Christian Albright, Wayne Winston, Christopher Zappe
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