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Unstable probability of being alive distribution in Pareto/NBD model

Open CinelliGucci opened this issue 1 year ago • 5 comments

Hi there, I am working on estimating the probability of being alive in a pool of customers using the Pareto/NBD model. I found the following a bit weird. The plots show the distribution of probabilities of being alive of my customers. The first is a concentrated distribution while the second one is more smooth. Both of them have been computed using the Pareto/NBD with the same customers and the same l2 coefficient. However, due to the optimization process (Nelder - Mead) the parameters of the model are different (a couple of figures below). Nonetheless, even with very similar parameters (see the third figure) there is this change in the shape of the distribution. Is there any explanation for this?

Screenshot 2023-03-03 at 15 24 16 Screenshot 2023-03-03 at 15 16 02 Screenshot 2023-03-03 at 15 34 39

CinelliGucci avatar Mar 03 '23 16:03 CinelliGucci