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20
Jan

THE POWER OF CUSTOMER SEGMENTATION & PREDICTIVE MODELING

Posted by Vision/Eagle:xm Staff

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As any good marketing department knows you can’t create great collateral without thought-provoking copy and awe-inspiring graphics. So why is it that we try to engage customers and increase sales conversions without the two most important marketing analytic tools - customer segmentation and predictive modeling - in our marketing mix?

Customer Segmentation -  when defined accurately, customer segmentation is a powerful strategic roadmap that can help shorten purchase cycles, drive higher spend, build customer loyalty, win-back and lower service and support costs.

Predictive modeling - predictive modeling is the exercise of calculating customer behaviors to determine future customer actions. Predictive modeling can help identify the most profitable customers with the greatest profit potential or those most likely to discontinue business.

Benefit - the maximum benefit are the results you get when you effectively combine both segmentation and modeling.  While segmentation provides the groundwork for designing, testing, measuring and launching marketing initiatives, predictive modeling renders new opportunities and offers a greater concentration of targeting accuracy.

Aberdeen research reported companies using predictive analytics experienced 75 percent higher click through rate and a 73 percent higher sales lift than non users.

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