Overview

Professor Ascarza’s research primarily focuses on providing researchers and marketers a better understanding of how to manage customer retention so as to reduce churn and increase firm’s profitability. She addresses these issues by building empirical models of customer relationship management with a focus on understanding and managing customer retention (i.e., reducing customer churn). While previous literature on customer relationship management (CRM) has predominantly used secondary data, she investigates most of these research questions from the lenses of causal inference (e.g., running field experiments). Some of her findings are counter-intuitive at first glance, but compelling once she pins down the underlying mechanisms. For example, some of her recent work challenges the very common practice of focusing on ‘risk of churning’ as the most important metric for proactive churn management. Combining two field experiments in different industries, professor Ascarza shows that, when the goal is to select customers for proactive/preventive retention efforts, identifying customers who have a high risk of churning might be missing the point. In turn, she empirically demonstrates that customers with the highest risk of churning and those who should be targeted are not necessarily the same. In another field study, Professor Ascarza investigates the role of social influence in retention campaigns. Specifically, she examines the role of the (telecommunications) network in influencing usage and retention decisions among customers who did not receive a marketing campaign, but who were connected to those who were targeted in the campaign. She finds a social multiplier of 1.28. That is, the effect of the campaign on first-degree connections of targeted customers is 28% of the effect of the campaign on the targeted customers.