Early Detection of User Exits from Clickstream Data: A Markov Modulated Marked Point Process Model

Abstract

Most users leave e-commerce websites with no purchase. Hence, it is important for website owners to detect users at risk of exiting and intervene early (e. g., adapting website content or offering price promotions). Prior approaches make widespread use of clickstream data; however, state-of-the-art algorithms only model the sequence of web pages visited and not the time spent on them. In this paper, we develop a novel Markov modulated marked point process (M3PP) model for detecting users at risk of exiting with no purchase from clickstream data. It accommodates clickstream data in a holistic manner: our proposed M3PP models both the sequence of pages visited and the temporal dynamics between them, i. e., the time spent on pages. This is achieved by a continuous-time marked point process. Different from previous Markovian clickstream models, our M3PP is the first model in which the continuous nature of time is considered. The marked point process is modulated by a continuous-time Markov process in order to account for different latent shopping phases. As a secondary contribution, we suggest a risk assessment framework. Rather than predicting future page visits, we compute a user's risk of exiting with no purchase. For this purpose, we build upon sequential hypothesis testing in order to suggest a risk score for user exits. Our computational experiments draw upon real-world clickstream data provided by a large online retailer. Based on this, we find that state-of-the-art algorithms are consistently outperformed by our M3PP model in terms of both AUROC (+ 6.24 percentage points) and so-called time of early warning (+ 12.93 %). Accordingly, our M3PP model allows for timely detections of user exits and thus provides sufficient time for e-commerce website owners to trigger dynamic online interventions.