TSUNAMI - an explainable PPM approach for customer churn prediction in evolving retail data environments

Abstract

Retail companies are greatly interested in performing continuous monitoring of purchase traces of customers, to identify weak customers and take the necessary actions to improve customer satisfaction and ensure their revenues remain unaffected. In this paper, we formulate the customer churn prediction problem as a Predictive Process Monitoring (PPM) problem to be addressed under possible dynamic conditions of evolving retail data environments. To this aim, we propose TSUNAMI as a PPM approach to monitor the customer loyalty in the retail sector. It processes online the sale receipt stream produced by customers of a retail business company and learns a deep neural model to early detect possible purchase customer traces that will outcome in future churners. In addition, the proposed approach integrates a mechanism to detect concept drifts in customer purchase traces and adapts the deep neural model to concept drifts. Finally, to make decisions of customer purchase monitoring explainable to potential stakeholders, we analyse Shapley values of decisions, to explain which characteristics of the customer purchase traces are the most relevant for disentangling churners from non-churners and how these characteristics have possibly changed over time. Experiments with two benchmark retail data sets explore the effectiveness of the proposed approach.