Customer

1
CRM Project

• Customer
• Campaign Planning Engineering
• Selling Broadband Products
• Dr. Evangelos Xevelonakis

2
Defining The Business Problem

• A Telecommunication Company has the strategic
  goal to acquire new customers in the broadband
  area. The acquisition program should target
  customers with similar needs and characteristics
  in order to increase its efficiency and
  effectiveness. For this purpose the marketing
  department decided to use a segmentation
  approach. Two different segments were defined
• The cost conscious customers (60 000)
• The professionals (40 000)
• Cost Conscious customers are looking for the
  best possible deal and will change their calling
  pattern to fit the cheapest rates that are
  offered. They have a vocational education and
  live in the city. Typical professions are
  handcraft and service jobs. They could be
  influenced by friends, colleagues and TV.
• Professionals are extremely comfortable and
  knowledgeable about the internet. They use it for
  work, online banking, shopping, and sharing price
  information or for trading. They have a academic
  education. Typical professions are IT
  Specialists, Engineers or Marketing specialists.
  They leave near the city and are seeking actively
  information. Time and Efficiency are very
  important for them.

3
Modelling Customers

• The Data Analysis Department developed a
  Propensity to Buy Model using predictive
  modelling techniques. This model was used to
  calculate the likelihood of potential customers
  to accept the offer.

Decile Take Rate With No Model Take Rate Using a Model
10 10 35
20 20 60
30 30 70
40 40 78
50 50 85
60 60 90
70 70 94
80 80 97
90 90 99
100 100 100
The picture compares the performance of a
customer selection using the predictive model
with the performance of a random selection.
4
Designing the Customer Program

• Within the strategic planning the company decided
  to carry out two customer campaigns one for the
  cost conscious and one for the professionals. The
  developed predictive model should be used for
  defining the target group. Following parameters
  could be used for this purpose
• Campaign Cost Conscious
• - Cost for Call Center 6. per Contact
• - expected Take Rate 3
• - Margin 20
• - Cost of the addresses 0.35. per Address
• - Costs for the Incentive 30. per new
  contract - expected customer revenue 1500.---
  per Year
• Campaign Professionals
• The decision was to carry out a two step
  campaign
• - Costs for Direct Mail 3.--
• - Cost for the Call Center 10.--
• - expected Take Rate 2
• - Margin 20
• - Cost of the addresses 0.35. per Address
• - expected customer revenue . 2000.

5
Tasks

• You are CRM Advisor in the company and you are
  expected to support the Marketing Department to
  design a successful campaign. Your goal is to
  achieve a high take rate with low costs.
  Following tasks have to be carried out
• Defining the Campaign Plan
• . Time Frame
• . Involved persons
• . etc.
• Designing the Campaign
• . Calculate the model lift
• . Calculate the annually expected profit for the
  model based and random based Selection for all
  deciles (10 steps)
• . Define the optimal target group using Excel
• . Discuss the model oriented approach (Risks,
  chances)
• . Discuss the limitations of this approach

6
Tasks

• Communication
• Develop the right message for each segment. Use
  thereby the segment profiles.
• Skills, Process and Systems
• . Develop the required process for the
  operational part of the campaign. Use thereby the
  Event Driven Diagram
• . Discuss the required systems for carrying out
  thr campaign
• . How can you evaluate the success of the
  campaign?