A System Dynamics Framework for Market Share Forecasting in the Telecommunications Market

This paper presents a novel system dynamics-based framework for forecasting market share evolution in the telecommunications sector. The framework conceptualizes market share as flows of subscribers—driven by churn, attraction, and market growth—between interconnected compartments representing providers. It is designed to operate with limited available market data and incorporates stochastic processes to capture market uncertainty, enabling risk-informed forecasts. The framework is applied to the Greek mobile telecommunications market using historical data (2006–2022), with a 5-year hold-back period for validation. Results highlight the dominant role of churn management in market share variability, particularly for the incumbent provider Cosmote, while subscriber attraction parameters show moderate influence for alternative providers Vodafone and Wind Hellas. Sensitivity analysis confirms the model’s robustness and identifies key drivers of forecast variability. The proposed framework provides actionable insights for strategic decision-making, making it a valuable tool for providers and policymakers to address churn, optimize attraction strategies, and ensure long-term competitiveness in dynamic markets.