Comparison of classical RFM models and Machine learning models in CLV prediction
Abstract
This study analyzes the difference between classical RFM models and Machine
Leaning (ML) models when calculating CLV with transactional data.
In this paper we run different programs to analyze the CLV value by using both
methods. Based on the results, the researchers found out that Pareto/NBD model have
better predictive power of performing CLV predictions than ML models. Lastly, the
findings proved the effectiveness of the Pareto/NBD method of calculating CLV.
Description
Masteroppgave(MSc) in Master of Science in Business Analytics - Handelshøyskolen BI, 2020