Data Deep Dive: The Art of Targeting
- One model designed to measure responsiveness, and
- Another to measure likelihood to be approved.
The major benefit for having separate models is that each model will be able employ different types and sources of data variables. A more practical benefit for the users is that the marketers will be able to pick and choose what is more important to them at the time of campaign execution. They will obviously go to the top corner bracket, where both scores are high (i.e., potential responders who are likely to be approved). But as they dial the selection down, they will be able to test responsiveness and credit-worthiness separately.
Mixing Multiple Model Scores
Even when multiple models are developed with completely different intentions, mixing them up will produce very interesting results. Imagine you have access to scores for "High-Value Customer Model" and "Attrition Model." If you cross these scores in a simple 2x2 matrix, you can easily create a useful segment in one corner called "Valuable Vulnerable" (a term that my mentor created a long time ago). Yes, one score is predicting who is likely to drop your service, but who cares if that customer shows little or no value to your business? Take care of the valuable customers first.
This type of mixing and matching becomes really interesting if you have lots of pre-developed models. During my tenure at a large data compiling company, we built more than 120 models for all kinds of consumer characteristics for general use. I remember the real fun began when we started mixing multiple models, like combining a "NASCAR Fan" model with a "College Football Fan" model; a "Leaning Conservative" model with an "NRA Donor" model; an "Organic Food" one with a "Cook for Fun" model or a "Wine Enthusiast" model; a "Foreign Vacation" model with a "Luxury Hotel" model or a "Cruise" model; a "Safety and Security Conscious" model or a "Home Improvement" model with a "Homeowner" model, etc., etc.
Stephen H. Yu is a world-class database marketer. He has a proven track record in comprehensive strategic planning and tactical execution, effectively bridging the gap between the marketing and technology world with a balanced view obtained from more than 30 years of experience in best practices of database marketing. Currently, Yu is president and chief consultant at Willow Data Strategy. Previously, he was the head of analytics and insights at eClerx, and VP, Data Strategy & Analytics at Infogroup. Prior to that, Yu was the founding CTO of I-Behavior Inc., which pioneered the use of SKU-level behavioral data. “As a long-time data player with plenty of battle experiences, I would like to share my thoughts and knowledge that I obtained from being a bridge person between the marketing world and the technology world. In the end, data and analytics are just tools for decision-makers; let’s think about what we should be (or shouldn’t be) doing with them first. And the tools must be wielded properly to meet the goals, so let me share some useful tricks in database design, data refinement process and analytics.” Reach him at email@example.com.