Attrition models-the software programs credit card issuers rely on to predict account losses-are becoming more sophisticated.

Technology is improving these tools, just as competition is making this area of analysis more critical.

If an issuer can tell that an account is likely to be closed, it can evaluate what effort may be appropriate to keep it in the fold-and keep it profitable.

One software model under development, designed by Fair, Isaac & Co., will look for dropoffs in balances, which often signal that accounts are headed for dormancy.

The credit bureaus Experian Inc. and Trans Union Corp. said they will begin offering this model in 1999 as a complement to other scoring programs. Trans Union now offers a Fair, Isaac attrition model for issuers, but it looks only at accounts with little or no activity.

Account flight has been growing slowly but steadily in the last five years, which has made credit card companies much more attentive.

Attrition is "one of the current major issues facing the card issuers," said David Gagie, marketing director at Auriemma Consulting Group Inc. of Westbury, N.Y. Among larger issuers in particular, "the challenge to replace what they lose is phenomenal."

And "the cost of acquiring new accounts is going up," said Cheri St. John, senior vice president of North America credit bureau services at Fair, Isaac. That puts "more of an emphasis on trying to retain existing customers," Ms. St. John said. "In the past, a lot of the focus was on the acquisition of new customers."

The emphasis on customer retention has spurred vendors like Fair, Isaac and HNC Software Inc. to fine-tune their products. Trans Union markets Fair, Isaac's attrition software under the product name Sentry. San Diego- based HNC has offered an attrition feature since 1995 as part of its ProfitMax credit card profit assessment model.

Executives at Fair, Isaac in San Rafael, Calif., tout their model's ability to find not only customers likely to close an account but also accounts probably headed for "silent attrition"-still open but rarely or never used.

The Fair, Isaac product is also meant to look at such variables as the age of a customer's account and the number of accounts a cardholder has opened recently with competitors.

Experian of Orange, Calif., and Trans Union of Chicago said they have yet to price the product for their issuers. Citing competitive concerns, Trans Union would not discuss the fee for its current attrition model.

Geoffrey Gunn, product manager at Experian, said the attrition score is a nice complement to so-called revenue scores, which issuers use to predict customers' profitability.

"In conjunction with the revenue score, this tool can help determine which customers you want to keep," Mr. Gunn said.

PSI Global found that 15% of credit card customers closed accounts in the 12 months that ended this May. That was down from 17% in the preceding 12 months but well above the 9% in the year through May 1993.

In the Tampa-based research firm's annual survey of 2,500 households, the most mentioned reasons for closing accounts were high interest rates, having too many credit cards, or wanting to open a new account.

Card issuers' marketing is no less aggressive. In the second quarter, direct mail solicitations hit an all-time high of 950 million pieces, according to BAI Global of Tarrytown, N.Y. Volume is on course to break the 1997 record of more than three billion.

With better technology and more sophisticated models, issuers will be better able to "draw a line in the sand" and curtail low-rate teaser offers, said James Accomando, president of Accomando Consulting Inc. of Fairfield, Conn. This way, "you can pinpoint the best offerings to people" seen as likely to defect.

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