1. Applications of Social Media to 1-1 Marketing:
Listen, Then Talk
Magnify Analytic Solutions:
Keith Shields, Chief Analytics Officer
Roni Leibovitch, Manager, Digital Intelligence
Mindy Deatrick, Lead Consultant, Decision Sciences
10. magnify • simplify • amplifyMagnifyAnalytic Solutions
DMA Detroit 2013: Applications of Social Media to 1-1 Marketing
No Model
Use a Model
Profit = $10,000
Profit = $14,000
40% improvement
Population
Organic
Take Rate
Offer
Take Rate
Incremental
“Takers”
100,000 10% 11% 1,000
Incremental
Revenue
$250,000
Model
Rank
Population
Organic Take
Rate
Offer
Take Rate
Incremental
“Takers”
1 25,000 18% 19.80% 450
2 25,000 14% 15.40% 350
3 25,000 6% 6.60% 150
4 25,000 2% 2.20% 50
Incremental
Cost
Incremental
Profit
$240,000 $10,000
Incremental
Revenue
$112,500
$87,500
$37,500
$12,500
Incremental
Cost
Incremental
Profit
$104,000 $8,500
$82,000 $5,500
$38,000 ($500)
$16,000 ($3,500)
Why You Want to Improve Your Predictive Models (2)
• An example involving a pre-approval program: An untargeted (no model), incentivized loan
offer to 100,000 customers increases the “take rate” by 10%.
• The revenue per incremental loan is $250.
• The cost of communicating the offer to 100,000 consumers is $20,000.
• The cost of the incentive is $20 per loan.
• When we apply a predictive model, we split the population into 4 groups (1=most likely to
take…4=least likely to take)