Comparative study of business-customer signaling game and its genetic algorithm

According to the characteristic of combination between cooperate game and non-cooperate game among business and customer in Customer Relationship Management (CRM), a business-customer signaling utility model was developed, which was composed of six signals such as advertisement input level, product price, service level sent by the business, consultation input level, purchase quantity in one time and satisfactory degree sent by the customer. The model was solved by two methods. One was to get the equilibrium by applying Backwards Induction, to explain the rational selections of business and customer. The other was to get the optimal resource configuration by applying genetic algorithm. The two methods explained and compared the activities of business and customer in CRM from the different standpoints.