Research On Non-VIP Customers Churn Of Telecom Companies Based On System Dynamics

Chinese telecom industry has entered the 4G era. The rapid development has brought great challenges to the customer management of communications industry. Whether the subdivision of the customer or prediction of churn of customers is a currently focus study. Customer resources have come to be the competitive resources of the telecommunications companies. With the improvement of the material conditions of people's lives, the demand for communication is also increasing. The growing number of customers and the more and more complex interaction relationship of the ultra large scale-oriented customer make the customer of the telecommunications companies higher dynamic, and the competition among enterprises more fierce. Meanwhile, the gap is getting smaller and smaller, resulting in high customer turnover rate.For high turnover rate of the customer of telecommunications companies, this paper will focus on the Non-VIP customer. Those customers are not only very large in the number, but also very dynamic and easily lost in comparison with the VIP customers. The Non-VIP customers play an important role in the customers of telecommunications companies, not only bringing huge profits for the enterprise, but also playing a strategic role in the long-term development of the enterprise. Before building the model, this paper defined the concept of the Non-VIP customers, and analyzed the state of turnover for the Non-VIP customers in detail from the aspects of population distribution, demand characteristics and consumption features. In the meantime the author introduced the scale factor to explain group effect.Firstly, the author identified the key factors, and then analyzed key influencing factors from causation with the theory of system dynamics, building causal diagram of system dynamics of the Non-VIP customers churn. Secondly, the author analyzed the intrinsic link of groups effects, price, service and infrastructure investment and quantify the factors mathematically, formulating the relationship between the factors as the way of expression, to construct the system dynamics model of the Non-VIP customers churn. Finally the author adjusted the size of the influence factor to simulate the model, observe the dynamic characteristics of the system, identify the sensitivity of the factors affecting, the customer churn and customer scale. For the simulation results of sensitivity, effective measures to deal with the Non-VIP customers churn of the telecommunications companies were proposed to provide a reference for telecom companies.