Using Big Data Analysis to Retain Customers for Telecom
Industry
Yuanhu Gu
College of Information Technology
and Computer Science
University of the Cordilleras
Baguio, Benguet, Philippines
(+63)9271639145
Tiger18921884431@gmail.com
Josephine S. Dela Cruz
College of Information Technology
and Computer Science
University of the Cordilleras
Baguio, Benguet, Philippines
(+63)9496513187
delacruzpen@gmail.com
ABSTRACT
Nowadays, telecommunication markets are becoming more and
more competitive, and customer churn is becoming more and
more serious. In the tough competitive mobile market, Customer
Churn Management is becoming more and more critical. In
developing countries, most customers switch service providers
because of good promotional incentives and lower monthly costs
offered by competitive service providers. How to predict customer
churn quickly and accurately becomes very important. In this
paper, the researchers successfully analyzed the customer churn
using big data feature analysis and multi-feature analysis. User
data were modeled by XGBoost algorithm. The model is
optimized repeatedly with GridSearchCV as a parameter tool. The
accuracy of the model on the test set is 85.1%. The researchers
predicted about 11000 customer lists per month that may be about
to churn. Using K-means clustering method, 11000 churn target
customers per month were classified into three categories and
telecom companies are suggested to take some solutions which
are found by feature analysis to retain customers. This big data
analysis can be used to retain customers for the telecom industry.
CCS Concepts
• Information systems➝Information system applications➝
Data mining.
Keywords
Big data analysis; retain customers; customer churn; telecom
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ICCAI '19, April 19–22, 2019, Bali, Indonesia
© 2019 Association for Computing Machinery.
ICCAI '19, April 19–22, 2019, Bali, Indonesia
ACM ISBN 978-1-4503-6106-4/19/04…$15.00
DOI: https://doi.org/10.1145/3330482.3330510
38
Alvin R. Malicdem
College of Information Technology
Don Mariano Marcos Memorial State University
La Union, Philippines
(+63)9166458405
amalicdem@dmmmsu.edu.ph
Thelma Domingo Palaoag
College of Information Technology
and Computer Science
University of the Cordilleras
Baguio, Benguet, Philippines
(+63)9997134118
tpalaoag@gmail.com
industry; feature analysis.
1. INTRODUCTION
As the market of the telecom industry grows more and more
mature, the competition among telecom companies becomes more
and more intense. The market is saturated. Some telecom
companies are finding various ways to lure customers away from
their competitors. So the new telecom companies provide various
schemes and services to attract multiple customers to get the
switch from competitor's service to their service [1]. Loss of
customer from their service provider is known as churn [2].
Therefore the old companies should predict churn customers and
retain their existing customers.
As a telecom company, they need to pay attention to the data of
churn customers every month. The researcher works in a telecom
company and provides the statement of churn customers. Last
year, the researcher found that the rate of churn customers is
4.73%, which is 1.05 percentage points higher than the monthly
average rate of 3.68% for the whole network. The researchers
gave comprehensive big data support from data modeling and
analysis. The customers churn characteristics were analyzed and
the problem was found. Competitors jointly launched “King Card”
business to the public in an Internet game, which caused a
significant upsurge in the industry market by lowering the tariff
and exempting the traffic usage fee of the series products of the
game company. This set of tariff policy combined with the
operation mode of APP cartridge pushing has a significant impact
on the loss of active users of the game.
The researchers analyzed the characteristics of customers from the
aspects of using quality, accessing APP features, time segment
and times of playing King of Glory, customers’ package attributes,
customers' mobile terminal attributes, traffic saturation, terminal
compensation value and fee compensation value, and further
carried out detailed analysis to find countermeasures. User data
were modeled by XGBoost algorithm, which is an integrated
learning method. This is known as Customer Churn Prediction
(CCP) [3]. The model is optimized repeatedly with GridSearchCV
as a parameter adjusting tool. Finally, the accuracy of the model
on the test set is 85.1%. The researchers predicted about 11000
customer lists per month that may be about to churn. Using K-
means clustering method, about 11000 churn target customers per
month are classified into three categories: traffic-restrained users,
price-sensitive users and traffic infinite relocation users. The
researchers suggested our company to take some methods to
retain customers. For three kinds of target churn customers, we
successfully maintain about 9000 users per month through online
public number precise push, off-line stock center call, stage gift
traffic, gift wing payment of red envelope, recharge discount,
relocation of an unlimited package and other policies. The churn
rate is reduced by 0.93%. This big data analysis can be used as
Customer Churn Prediction and to retain customers for the
telecom industry.
2. CONCEPTUAL FRAMEWORK
There are three main difficulties for customer churn prediction
modeling. First, the customer churn data set is substantially
imbalanced in reality. Second, the samples in feature space are
relatively scattering. Third, the dimension of feature space is high
and dimension reduction is necessary for algorithm efficiency [4].
So, it is challenging to build a good model. The conceptual
framework is shown as Figure 1.
INPUT PROCESS OUTPUT
Data Feature Prediction
Analysis
Collecting
Multi-feature Assessment
Analysis
Data
Cleansing Modeling Solution
Figure 1. Design framework.
INPUT: Due to the rapid development of information technology,
especially the rapid development of the Internet, the dimension of
customer attributes is quite large. Data collection is a fundamental
and enormous task. The data is also not very clean and needs to be
cleaned with experience.
PROCESS: High-dimensional features will increase computing
costs and information redundancy. So it needs to conduct feature
analysis and multi-feature analysis to find reasonable features to
model.
OUTPUT: Customers leave the company for different reasons. In
other words, the positive points (churn case) are dispersed in the
feature space [4]. Therefore, the model needs repeated
optimization and evaluation. After prediction, the researchers
should classify churn customers and put forward some
suggestions on how to solve the problem.
3. REVIEW OF RELATED LITERATURE
The researchers work in a telecom company for many years.
Every month, churn customers should be paid attention more to.
But it is difficult to analyze customer churn. The researchers
studied from internet and other companies, and think how to
predict customer churn. Big Data has significant impact in
developing and supporting modern societies [5].
3.1 Customer Churn
The new customers for one Telecommunication Company are
mostly the lost customers from another one. Telecommunication
companies are suffering from losing customers from time to time,
39
which is known as customer churn [4]. It has become harder for
telecom providers to acquire new customers, and the need for
retaining existing ones has become of paramount importance [6].
So the goal of our project is to analyze and predict which
customers are might be going churn or not by using dataset of
customers. This will help the telecom companies to know in
advance which customer may switch from their service to their
competitor's service [1]. India telecom competition is similar with
China telecom, and they have done customer churn analysis.
3.2 Data Cleansing
Data cleansing can be considered to be an activity that is
performed on the data sets of the data warehouse. The cleansing is
done in order to enhance and collectively maintain data
consistency and quality [7]. Data cleansing is vital, especially for
redefining some null values, time segments, etc.
3.3 Feature Analysis
When the number of features is very large relative to the number
of observations in your dataset, certain algorithms struggle to train
effective models. This is called the “Curse of Dimensionality,”
and it’s especially relevant for clustering algorithms that rely on
distance calculations [8]. Feature models have been commonly
used to model the variability in software product lines [9]. Feature
analysis and multi-feature analysis can help us determine which
parameters are important. Through these analyses, maybe the
reasons can be found. In this study, the researchers have done a lot
of feature analysis and multi-feature analysis based on experience.
3.4 Model Building
In the paper “Dyad Churn: Customer Churn Prediction using
Strong Social Ties”, it says: We propose a dyadic based churn
prediction model, Dyad Churn, where customer churn is modeled
through social influence that propagates in the telecom network
over strong social ties [6]. This is advantage, but it needs a lot of
data, and collecting these data is very difficult. At the same time,
the workload of modeling is also very large. Due to the scattered
reasons of telecom customer churn, the accuracy and recall rate of
these data modeling are also problems. As a result, churn
prediction has become one of the main telecom challenges [10].
4. METHODOLOGY
As a telecom company, the administrators need to pay attention to
the data of churn customers every month. The researcher works in
a telecom company and provides the statement of churn customers.
We should do daily big data analysis. If someone finds a problem,
we also should do big data analysis, in order to get the reason of
the problem and the method to solve it. The methodology is
shown as Figure 2.
Daily big Multi-
data analysis Feature
feature Modeling Prediction
Analysis
Analysis
Discovered
problems
Assessment
Data
Collecting
Solution
Figure 2. Methodology
First, the researchers collect and clean the data, usually such as:
time segment and times of accessing the internet, customers’
package attributes, customers' mobile terminal attributes, traffic
saturation, terminal compensation value and fee compensation Set price (package price) is the fee per month at least. It includes
value, etc. Then, the researchers do feature analysis and multi- internet traffic, voice, etc. Set price is separated by 10 or 20￥.
feature analysis. Maybe, it is need to collect other new data. We For example, 50 means 40< set price<=50. The relationship
will apply the new data from other systems; sometimes we should between package price and customer churn is shown as Figure 4.
build a new system or method to collect new data.
Second, the researchers build the model through business
experience and analysis of the above features. Then prediction and
assessment, user big data are modeled by XGBoost algorithm,
which is an integrated learning method. In order to improve the
efficiency and accuracy of prediction, the researchers should
select appropriate features and remove the less important
parameters. The model is optimized repeatedly with
GridSearchCV as a parameter adjusting tool. After repeated
prediction, evaluation and optimization, we can find a reasonable
and high accuracy of evaluation and recall rate.
Finally, the researchers use K-means clustering method to classify
the prediction result, propose solutions and suggest our company
to take some methods to retain customers.

5. RESULT AND DISCUSSION

5.1 Background
The researcher found that customer churn was 1 percentage point
higher than in previous months. Running majority analysis, it was
found that a feature was more centralized churn. Further analysis
of user's online behavior showed that the user was playing a game:
King of Glory. This analysis data set includes one month data of
user’s online behavior and other customer profiles.
According to market survey, China Unicom combined the
Tencent Company and launched Unicom's large and small King
Card business to the public, which caused a great upsurge in the
industry market in the way of lower tariffs and exemption from
the data traffic usage fees of Tencent products. This set of tariff
policy combined with the operation mode of Tencent App
cartridge pushing has a significant impact on the loss of active
users of Tencent games on local E-surfing mobile.
5.2 Customer Churn Feature Analysis
5.2.1 Times of Accessing APP
The times of accessing APP King of Glory every person per
month are separated three classes: seldom (times<30), often
(30<=times<100), usually (times>=100).
Figure 4. Churn - package price.
According to analyze the telecom package price of mobile phone,
the researcher found that customers handling the 50 ￥ card
package churn very easily. This part of customers accounted for
27% of the total churn. The churn rate is very high.
5.2.3 Sales Channels
From the top 10 sale channels of churn customers, there are 5
campus channels. The probability of churn of students is relatively
high, which is related to students' lack of income and pursuit of
cheap fares. Of course, students like to play King of Glory very
much.
5.2.4 Internet Traffic Saturation in Telecom Package
The researchers studied the proportion of usage internet traffic to
package traffic. The analysis of Internet Traffic Saturation –
Churn is shown as Figure 5. It is separated into five segments: low
(usage<=80% P (package internet traffic)), close (80%
P<usage<=100% P), exceed (100% P<usage<=130% P), double
(130% P<usage<=200% P), high (usage>200% P). 100% P is the
saturation of internet traffic in Telecom Package.

Figure 3. Times of accessing to APP – churn. Figure 5. Internet traffic saturation – churn.

According to analyze the times of accessing APP King of Glory
shown as Figure 3, the researcher found that customers of
“Usually” accessing APP are easy to churn. Because they have a
lot of demand for internet data, they are easy to churn and choose
competitor's service.
5.2.2 Telecom Package Price
Customers who are close or exceed to the saturation of the main
telecom packages internet traffic are prone to churn. They can
locate two groups:
1. Rational consumer: the package internet traffic is not enough to
support consumer demand, pay more attention to cost-effective,
and often pay attention to the residual internet traffic in the
package. This part of users is vulnerable to the unlimited internet

40
traffic and low fee policies of Unicom “King Card” for Tencent display, and even can improve the accuracy of model prediction
games. by combining these two features.
2. Heavy internet traffic consumer: For the huge demand for
internet traffic, traffic often exceeds the standard, and buys over-
flow packages. There is a huge temptation for “King Card”
infinite Tencent game traffic policy.
5.2.5 Terminal Brand
The researchers analyzed the mobile terminal brands among churn
customers shown as Figure 6.
Users using OPPO and VIVO account for half of all churn users,
and the churn rate of users using these two brands is relatively
high. These churn rates do not fully explain the quality and
stickiness of mobile phones, because the sales of these brands are
not the same, and high-volume brands naturally account for a high
proportion of lost users. But this shows that we should focus on
the mobile phone brand.
The researchers found the terminal price is the important factors.
Users of high-end mobile phones are more likely to recognize the
service quality of telecommunications products, with high loyalty
and relatively low loss. Based on the analysis of the brand use of Figure 7. Characteristic correlation analysis.
churn users, the users who choose high-terminal Huawei,
Samsung and Millet mobile phones are relatively conservative and 5.3.2 The Time And Times of Playing APP
not easy to churn. The researchers separated customers who played King of Glory
into two categories according to the number of access (log in).
One is more access (more than 50 times per month), and the other
is fewer access. They are shown as Figure 8 and Figure 9.

Figure 6. Terminal brand – churn.

Figure 8. Log in more times – churn.
5.3 Customer Multi-feature Analysis
5.3.1 Characteristic Correlation Analysis Users who play King of Glory more often (log in more than 50
Before the model training, we analyze the correlation between two times) in the middle of the night (from 11 o'clock to 7 o'clock the
or two features, the correlation between each feature and the label, next day) are more likely to be churn than those who use it at
and the direct reservation of the strong correlation with the target other times.
label. The explanation which is strongly related to all the features
has no discrimination, so it can be removed directly.
From the correlation analysis chart shown as Figure 7, we can see
that red represents positive correlation, blue represents negative
correlation, and the deeper the color, the stronger the correlation.
We should make a concrete multi-feature analysis of strongly
correlated features.
Focus on the following characteristics: the time period of playing
King of Glory, the number of playing King of Glory, terminal
brand, the old and new degree of terminal brand, user balance,
whether it is the use of telecommunications broadband users,
traffic within the package.
The above multi-feature analysis for feature screening of Figure 9. Log in fewer times – churn.
modeling can determine which features to use through visual

41
Most users are focused on playing King of Glory before 23
o'clock in the day and evening, and users who play more times in
each period are more likely to churn than those who play fewer
times.
5.3.3 Balance and Telecom Broadband Purchase
Customers are separated into 4 categories according to the balance
(little, much) and broadband (purchase or non). The analysis of
Balance and Broadband Purchase – Churn is shown as Figure 10.
Figure 10. Balance and broadband purchase – churn.
In general, the majority of King of Glory’s users are broadband
products users of telecommunications, which are relatively
difficult to leave the network, and users with large account
balances are more difficult to leave the network. However, for
non-telecom broadband users and the balance are very small, the
probability of leaving the network is very high.
5.4 Modeling
Through business experience and analysis of the above features,
35 appropriate features were selected, and the accuracy of the
model was improved by combining single feature filtering method.
The feature importance is shown as Figure 11.
Figure 11. Feature importance.
User data are modeled by XGBoost algorithm, which is an
integrated learning method. The model is optimized repeatedly
with GridSearchCV as a parameter tool. Finally, the accuracy of
the model on the test set is 85.1%. This model predicts potential
churn customers among active users of King of Glory and gets
about 11000 churn customers lists per month.
42
5.5 Classify Churn Target Customers
Customers’ Segmentation is an important concept for designing
marketing campaigns to improve businesses and increase revenue.
Clustering algorithms can help marketing experts to achieve this
goal [11]. Using K-means clustering method, 11000 churn target
customers per month are classified into three categories: traffic-
restrained users, price-sensitive users and traffic infinite relocation
users. The online marketing is carried out by formulating the
matching policies of free gift traffic, recharge discount and
relocating unlimited package respectively.
For three kinds of target churn customers, we successfully
maintain about 9000 King of Glory potential churn customers
monthly, and the churn rate is reduced by 0.93%. This study is
mainly to find individual problems, and to conduct in-depth
research on them, propose solutions. Of course, daily customer
churn also needs to be analyzed, but it is generally difficult to
identify specific problems.
6. CONCLUSION
Churn is a big problem faced by telecom companies with fierce
competition in the market, and the large dimension of customer
attributes, the low similarity of reasons for churn and the low
churn rate are the difficulties of churn analysis. The researchers
conduct feature analysis and multi-feature analysis. After
experience and feature selection, the researchers selected some
features of high correlation degree to improve prediction accuracy
and efficiency. In this paper, the researchers successfully analyzed
the customer churn. User data are modeled by XGBoost algorithm.
The model is optimized repeatedly with GridSearchCV. The
accuracy of the model on the test set is 85.1%. The researchers
predicted about 11000 customer lists per month that may be about
to churn. Using K-means clustering method, about 11000 churn
target customers per month are classified into three categories and
telecom companies are suggested to take some methods to retain
customers. Every month about 9000 successfully are maintained.
The churn rate is reduced by 0.93% from 4.73%. According to
mobile ARPU value of 50 Yuan per user, 5.4 million Yuan of
business income was brought through the defense of King of
Glory in the whole year. At the same time, feature analysis can
find solutions to the problem. Additional customer churn features
may be added for better prediction. This customer churn
prediction through big data analysis may be used in other Asian
countries, such as India, Philippines, Vietnam and Indonesia,
which has large population, to retain customers for the telecom
industry.
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