A novel cost-sensitive framework for customer churn predictive modeling

in Decision Analytics (2015), 2(5),

Customer churn predictive modeling deals with predicting the probability of a customer defecting using historical, behavioral and socio-economical information. This tool is of great benefit to ... [more ▼]

Customer churn predictive modeling deals with predicting the probability of a customer defecting using historical, behavioral and socio-economical information. This tool is of great benefit to subscription based companies allowing them to maximize the results of retention campaigns. The problem of churn predictive modeling has been widely studied by the data mining and machine learning communities. It is usually tackled by using classification algorithms in order to learn the different patterns of both the churners and non-churners. Nevertheless, current state-of-the-art classification algorithms are not well aligned with commercial goals, in the sense that, the models miss to include the real financial costs and benefits during the training and evaluation phases. In the case of churn, evaluating a model based on a traditional measure such as accuracy or predictive power, does not yield to the best results when measured by the actual financial cost, ie. investment per subscriber on a loyalty campaign and the financial impact of failing to detect a real churner versus wrongly predicting a non-churner as a churner. In this paper, we present a new cost-sensitive framework for customer churn predictive modeling. First we propose a new financial based measure for evaluating the effectiveness of a churn campaign taking into account the available portfolio of offers, their individual financial cost and probability of offer acceptance depending on the customer profile. Then, using a real-world churn dataset we compare different cost-insensitive and cost-sensitive classification algorithms and measure their effectiveness based on their predictive power and also the cost optimization. The results show that using a cost-sensitive approach yields to an increase in cost savings of up to 26.4% [less ▲]

Patch-based Statistical Performance Analysis of Upsampling for Precise Super–Resolution

in 11th International Joint Conference on Computer Vision, Imaging and Computer Graphics Theory and Applications (VISAPP'15) (2015, March)

All existent methods for the statistical analysis of super–resolution approaches have stopped at the variance term, not accounting for the bias in the mean square error. In this paper we give an original ... [more ▼]

All existent methods for the statistical analysis of super–resolution approaches have stopped at the variance term, not accounting for the bias in the mean square error. In this paper we give an original derivation of the bias term. We propose to use a patch-based method inspired by the work of (Chatterjee and Milanfar, 2009). Our approach, however, is completely new as we derive a new affine bias model dedicated for the multi-frame super resolution framework. We apply the proposed statistical performance analysis to the Upsampling for Precise Super–Resolution (UP-SR) algorithm. This algorithm was shown experimentally to be a good solution for enhancing the resolution of depth sequences in both cases of global and local motions. Its performance is herein analyzed theoretically in terms of its approximated mean square error, using the proposed derivation of the bias. This analysis is validated experimentally on simulated static and dynamic depth sequences with a known ground truth. This provides an insightful understanding of the effects of noise variance, number of observed low resolution frames, and super–resolution factor on the final and intermediate performance of UP–SR. Our conclusion is that increasing the number of frames should improve the performance while the error is increased due to local motions, and to the upsampling which is part of UP-SR. [less ▲]

View-Independent Enhanced 3D Reconstruction of Non-Rigidly Deforming Objects

in 16th International Conference on Computer Analysis of Images and Patterns (2015)

In this paper, we target enhanced 3D reconstruction of non-rigidly deforming objects based on a view-independent surface representation with an automated recursive filtering scheme. This work improves ... [more ▼]

In this paper, we target enhanced 3D reconstruction of non-rigidly deforming objects based on a view-independent surface representation with an automated recursive filtering scheme. This work improves upon the KinectDeform algorithm which we recently proposed. KinectDeform uses an implicit viewdependent volumetric truncated signed distance function (TSDF) based surface representation. The view-dependence makes its pipeline complex by requiring surface prediction and extraction steps based on camera’s field of view. This paper proposes to use an explicit projection-based Moving Least Squares (MLS) surface representation from point-sets. Moreover, the empirical weighted filtering scheme in KinectDeform is replaced by an automated fusion scheme based on a Kalman filter. We analyze the performance of the proposed algorithm both qualitatively and quantitatively and show that it is able to produce enhanced and feature preserving 3D reconstructions. [less ▲]

Example-Dependent Cost-Sensitive Logistic Regression for Credit Scoring

in 2014 13th International Conference on Machine Learning and Applications (2014, December 03)

Several real-world classification problems are example-dependent cost-sensitive in nature, where the costs due to misclassification vary between examples. Credit scoring is a typical example of cost ... [more ▼]

Several real-world classification problems are example-dependent cost-sensitive in nature, where the costs due to misclassification vary between examples. Credit scoring is a typical example of cost-sensitive classification. However, it is usually treated using methods that do not take into account the real financial costs associated with the lending business. In this paper, we propose a new example-dependent cost matrix for credit scoring. Furthermore, we propose an algorithm that introduces the example-dependent costs into a logistic regression. Using two publicly available datasets, we compare our proposed method against state-of-the-art example-dependent cost-sensitive algorithms. The results highlight the importance of using real financial costs. Moreover, by using the proposed cost-sensitive logistic regression, significant improvements are made in the sense of higher savings. [less ▲]

RGB-D Multi-View System Calibration for Full 3D Scene Reconstruction

in 22nd International Conference on Pattern Recognition (ICPR'14) (2014)

One of the most crucial requirements for building a multi-view system is the estimation of relative poses of all cameras. An approach tailored for a RGB-D cameras based multi-view system is missing. We ... [more ▼]

One of the most crucial requirements for building a multi-view system is the estimation of relative poses of all cameras. An approach tailored for a RGB-D cameras based multi-view system is missing. We propose BAICP+ which combines Bundle Adjustment (BA) and Iterative Closest Point (ICP) algorithms to take into account both 2D visual and 3D shape information in one minimization formulation to estimate relative pose parameters of each camera. BAICP+ is generic enough to take different types of visual features into account and can be easily adapted to varying quality of 2D and 3D data. We perform experiments on real and simulated data. Results show that with the right weighting factor BAICP+ has an optimal performance when compared to BA and ICP used independently or sequentially. [less ▲]

Improving Credit Card Fraud Detection with Calibrated Probabilities

in Proceedings of the fourteenth SIAM International Conference on Data Mining, Philadelphia, Pennsylvania, USA, April 24-26, 2014. (2014)

Previous analysis has shown that applying Bayes minimum risk to detect credit card fraud leads to better results measured by monetary savings, as compared with traditional methodologies. Nevertheless ... [more ▼]

Previous analysis has shown that applying Bayes minimum risk to detect credit card fraud leads to better results measured by monetary savings, as compared with traditional methodologies. Nevertheless, this approach requires good probability estimates that not only separate well between positive and negative examples, but also assess the real probability of the event. Unfortunately, not all classification algorithms satisfy this restriction. In this paper, two different methods for calibrating probabilities are evaluated and analyzed in the context of credit card fraud detection, with the objective of finding the model that minimizes the real losses due to fraud. Even though under-sampling is often used in the context of classification with unbalanced datasets, it is shown that when probabilistic models are used to make decisions based on minimizing risk, using the full dataset provides significantly better results. In order to test the algorithms, a real dataset provided by a large European card processing company is used. It is shown that by calibrating the probabilities and then using Bayes minimum Risk the losses due to fraud are reduced. Furthermore, because of the good overall results, the aforementioned card processing company is currently incorporating the methodology proposed in this paper into their fraud detection system. Finally, the methodology has been tested on a different application, namely, direct marketing. [less ▲]

Dynamic Super Resolution of Depth Sequences with Non-Rigid Motions

in 20th International Conference on Image Processing (2013, September)

We enhance the resolution of depth videos acquired with low resolution time-of-flight cameras. To that end, we propose a new dedicated dynamic super-resolution that is capable to accurately super-resolve a ... [more ▼]

We enhance the resolution of depth videos acquired with low resolution time-of-flight cameras. To that end, we propose a new dedicated dynamic super-resolution that is capable to accurately super-resolve a depth sequence containing one or multiple moving objects without strong constraints on their shape or motion, thus clearly outperforming any existing super-resolution techniques that perform poorly on depth data and are either restricted to global motions or not precise because of an implicit estimation of motion. Our proposed approach is based on a new data model that leads to a robust registration of all depth frames after a dense upsampling. The texture-less nature of depth images allows to robustly handle sequences with multiple moving objects as confirmed by our experiments. [less ▲]

Mutli-Frame Super-Resolution by Enhanced Shift & Add

in 8th International Symposium on Image and Signal Processing and Analysis (2013)

A critical step in multi-frame super-resolution is the registration of frames based on their motion. We improve the performance of current state-of-the-art super-resolution techniques by proposing a more ... [more ▼]

A critical step in multi-frame super-resolution is the registration of frames based on their motion. We improve the performance of current state-of-the-art super-resolution techniques by proposing a more robust and accurate registration as early as in the initialization stage of the high resolution estimate. Indeed, we solve the limitations on scale and motion inherent to the classical Shift & Add approach by upsampling the low resolution frames up to the super-resolution factor prior to estimating motion or to median filtering. This is followed by an appropriate selective optimization, leading to an enhanced Shift & Add. Quantitative and qualitative evaluations have been conducted at two levels; the initial estimation and the final optimized super-resolution. Results show that the proposed algorithm outperforms existing state-of-art methods. [less ▲]

Cost Sensitive Credit Card Fraud Detection using Bayes Minimum Risk

in Proceedings of 12th International Conference on Machine Learning and Applications, ICMLA 2013 (2013), 1

Credit card fraud is a growing problem that affects card holders around the world. Fraud detection has been an interesting topic in machine learning. Nevertheless, current state of the art credit card ... [more ▼]

Credit card fraud is a growing problem that affects card holders around the world. Fraud detection has been an interesting topic in machine learning. Nevertheless, current state of the art credit card fraud detection algorithms miss to include the real costs of credit card fraud as a measure to evaluate algorithms. In this paper a new comparison measure that realistically represents the monetary gains and losses due to fraud detection is proposed. Moreover, using the proposed cost measure a cost sensitive method based on Bayes minimum risk is presented. This method is compared with state of the art algorithms and shows improvements up to 23% measured by cost. The results of this paper are based on real life transactional data provided by a large European card processing company. [less ▲]

Real-Time Distance-Dependent Mapping for a Hybrid ToF Multi-Camera Rig

in IEEE Journal of Selected Topics in Signal Processing (2012), 6(5), 1-12