—Companies are viewing customers in terms of
their lifetime duration. Customer lifetime duration is a
powerful and straightforward measure that synthesizes churn
(attrition) risk at individual customer level. For existing
customers, customer lifetime duration can help companies
develop customer loyalty and treatment strategies to maximize
customer value. In this study, based on the Kumaraswamy
distribution, the Kumaraswamy Lindley distribution is studied.
Some mathematical properties of Kumaraswamy Lindley
distribution such as moments, hazard function, quantile
function, skewness, kurtosis are derived. The method of
maximum likelihood is used to estimate the model parameters
and the observed information matrix is derived. An application
of our results is provided to show the applicability of this
distribution, especially for customer lifetime duration.
Therefore, the proposed distribution can be a useful tool to
analyze customer lifetime duration in marketing research.
—Customer lifetime, Kumaraswamy
distribution, Lindley distribution, moments, maximum
likelihood estimation, marketing research.
The authors are with Department of Statistics, Hacettepe University,
06800, Turkey (e-mail: selencakmakyapan@ hacettepe.edu.tr,gamzeozl@
Cite: Selen Çakmakyapan and Gamze Özel Kadılar, "A New Customer Lifetime Duration Distribution: The Kumaraswamy Lindley Distribution," International Journal of Trade, Economics and Finance vol.5, no.5, pp. 441-444, 2014.