Publishers Clearing House’s Marketing Secret: Customize Offers with Real-Time Consumer Profitability Data
All customers are not created equal. And one aspect of Publisher's Clearing House's success that we did not have the space to get into in the cover story is the way it leverages real-time consumer profitability data to customize offers based on the consumer's calculated risk.
Many of Publisher's Clearing House's offers are bill-me, meaning the recipient can sign up to receive the subscription or product on the promise that the bill will be paid once its received. This is common in the publishing industry, and legally speaking it's not an offer of credit. But according to Rick Witsell, vice president of marketing and compliance at Alliant, which assists Publisher's Clearing House with consumer data, the offers are still a significant risk. The percentage of buyers who don't pay the bill or complete the offer has a large impact on the profitability of the offer.
Keith Bergendorff, assistant vice president of analytical services at Publisher's Clearing House, was part of the panel "Life Cycle Modeling: To Increase Response, Payment and Retention," at DMA 2011 along with Alliant vice president of customer engagement Mary-Jo Checco. There they discussed the methods Publisher's Clearing House uses to vet its bill-me offer recipients, and how that has effected campaign results.
Publishers Clearing House combines consumer credit data provided by Alliant with its own internal data to assign each prospect or new buyer a "behavioral profitability score." That score allows Publisher's Clearing House to determine how likely the prospect is to follow through on an offer and complete the transaction. According to Checco, "the scores are based on detailed transaction information contained within Alliant's proprietary cooperative databases. Each score predicts the consumer's expected profitability for PCH offers. PCH combines the Alliant information with their internal Web-based data and segments the names for specific marketing offers."