Developments in Customer Management
(A2025-125532)

AUTHORS

VERENA SCHOENMUELLER, ESADE; Aurélie Lemmens, Rotterdam School of Management (RSM) Erasmus University Rotterdam; Baris Kocaman, Vrije Universiteit Amsterdam; BARAK LIBAI, Reichman University

ABSTRACT

The session explores challenges and opportunities in customer management driven by market dynamics, such as evolving business models, the proliferation of start-ups across industries, and evolutions in digital platforms. These changes demand innovative strategies to retain and develop customers. The session evaluates these dynamics from multiple angles, and provides theoretical, empirical, and actionable insights into dual Product-Service System models, retention through targeted incentives, the dynamics of reliance on others and their effect on customer spending patterns, and customer churn dynamics of startups and young brands in general. Uncovering the Economic and Environmental Impact of Product-Service Systems by Baris Kocaman (Vrije Universiteit Amsterdam), Sarah Gelper (University of Luxembourg), Fred Langerak (Eindhoven University of Technology) This study investigates the economic and environmental impacts of Product-Service Systems (PSS), where firms offer products as subscription services. Analyzing six years of customer-level transaction data, the authors show that PSS models stabilize revenue and reduce material consumption, contributing to sustainability. Subscribers also exhibit increased loyalty, as seen in higher consumable purchases. This paper highlights how dual models can align profitability with environmental responsibility. Retention Through Relevance: Addressing Exit Motives through Targeting Policies by Arno De Caigny (IESEG), Aurelie Lemmens (Erasmus), Kristof Coussement (IESEG), Koen De Boek (Audencia) This research focuses on churn management by aligning retention strategies with customer exit motives. Using four years of exit data and a field experiment from a SaaS firm, the authors demonstrate how personalized retention emails significantly boost retention. Employing causal machine learning, the study offers a scalable framework for optimizing targeting strategies, reducing churn while improving satisfaction. The Feedback Dynamics of Consumer Reliance on Others: Evidence from Retail Trading by Neta Livneh (University of Oxford), Dana Turjemann (Reichman University), Barak Libai (Reichman University) This study examines how reliance on others impacts decisions and profitability in retail trading platforms. Social trading mechanisms, where individuals copy others’ investments, offer a unique research opportunity to study reliance. Analyzing data from 25,000 investors, the authors find reliance decreases over time due to asymmetric reactions to the traders own investments vs. the return from others they rely on. These patterns affect financial outcomes, trader value, and retention, with expertise and gender as moderating factors. The Churn Dynamics of Young Brands by Daniel McCarthy (University of Maryland), Barak Libai (Reichman University), Verena Schoenmueller (ESADE) The paper examines the dynamics of churn over the lifecycle of young subscription-based brands, showing that overall churn rates typically decline over time even during periods of rapid customer acquisition growth and increasing cohort-specific churn rates. Using an empirical dataset of 25 brands and simulation analyses, the authors demonstrate how heterogeneity in customer churn at the cohort level, customer acquisition growth, and cross-cohort differences shape overall churn rates. The findings highlight the perils of simplistically using the overall churn rate to evaluate underlying trends in customer and firm value.