Abstract We study how consumers decide which tariff plan to choose and whether to churn when their friends churn in the mobile industry. We develop a theoretical model showing conditions under which users remain with their carrier and conditions under which they churn when their friends do. We then use a large and rich anonymized longitudinal panel of call detailed records to characterize the consumers’ path to death with unprecedented level of detail. We explore the structure of the network inferred from these data to derive instruments for friends’ churn, which is typically endogenous in network settings. This allows us to econometrically identify the effect of peer influence in our setting. On average, we find that each additional friend that churns increases the monthly churn rate by 0.06 percent. The observed monthly churn rate across our dataset is 2.15 percent. We also find that firms introducing the pre-paid tariff plans that charge the same price to call users inside and outside the carrier help retain consumers that would otherwise churn. In our setting, without this tariff plan the monthly churn rate could have been as high as 8.09 percent. We perform a number of robustness checks, in particular to how we define friends in the social graph, and show that our results remain unchanged. Our paper shows that the traditional definition of customer lifetime value underestimates the value of consumers and, in particular, that of consumers with more friends due to the effect of contagious churn and, therefore, managers should actively take into account the structure of the social network when prioritizing whom to target during retention campaigns.

中文翻译：

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移动网络中朋友流失对消费者行为的影响

摘要 我们研究了当他们的朋友在移动行业流失时，消费者如何决定选择哪种资费计划以及是否流失。我们开发了一个理论模型，显示了用户继续使用其运营商的条件以及当他们的朋友这样做时他们流失的条件。然后，我们使用一个庞大而丰富的匿名纵向呼叫详细记录面板，以前所未有的详细程度来描述消费者的死亡之路。我们探索从这些数据中推断出的网络结构，以推导出朋友流失的工具，这在网络环境中通常是内生的。这使我们能够以计量经济学的方式确定同伴影响在我们的环境中的影响。平均而言，我们发现每增加一个流失的朋友，每月流失率就会增加 0.06%。在我们的数据集中观察到的每月流失率为 2.15%。我们还发现，引入预付费资费计划的公司以相同的价格呼叫运营商内部和外部的用户，有助于留住否则会流失的消费者。在我们的设置中，如果没有这个关税计划，每月流失率可能高达 8.09%。我们执行了许多稳健性检查，特别是我们如何在社交图中定义朋友，并表明我们的结果保持不变。我们的论文表明，客户终身价值的传统定义低估了消费者的价值，特别是由于传染性流失的影响，有更多朋友的消费者的价值，因此，