Customer churn: the missing link in public transport marketing

Growing public transport user markets is a fundamental goal of transport organisations worldwide. In the field of marketing a widespread strategy for understanding markets and facilitating growth is the measurement of ‘Customer Churn’ or the number of customers that defect (cease using) a service. Despite its prevalence in marketing, there is a single study available of Customer Churn in the context of public transport markets. This paper identified four core elements of market change; customer acquisitions, customer defections, customer retention and internal variability. The relevant literature on customer churn and similar studies in public transport (net market change, customer loyalty and internal variability) were assessed against whether they addressed these four elements. This identified that there was no singular method of measurement that reviewed all four elements of market change. To address this a new framework termed Customer Fluctuation, that holistically measures the rate of customer acquisitions, defections, retention and internal variability is proposed. This framework offers the potential of a more efficient and less ambiguous approach to understanding market changes and facilitating market growth.