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Brighton seo april 2015 lynchpin. segementation clustering presentation. creating clever clusters

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Data modelling presentation by Andrew Hood, MD of Lynchpin . Creating clusters in data to target and predict behaviour for profit. There are some handy links for tools including R and rattle.

Brighton seo april 2015 lynchpin. segementation clustering presentation. creating clever clusters

  1. 1. Creating Clever Clusters Segmentation for Profit Andrew Hood Managing Director @lynchpin www.Lynchpin.com
  2. 2. What is Marketing? 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 2 Satisfying needs and wants through an exchange process Philip Kotler “ ”
  3. 3. 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 3 The management process responsible for identifying, anticipating and satisfying customer requirements profitably Chartered Institute of Marketing What is Marketing? “ ”
  4. 4. 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 4 Marketing is now as much science as art due to the confluence of two simultaneous revolutions. The first is technological advances in platforms like Adobe Marketing Cloud, that allow marketers to gather, analyze and elegantly visualize large and complex data sets to gain customer insights. The second is the explosion of digital devices and channels - from smart phones to social media - which are the common currency of digital natives whose lives are transacted in pixels. Michael Schinelli, Chief Marketing Officer at the University of North Carolina’s Kenan-Flagler Business School “ ” 2014?...
  5. 5. 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 5 It’s more important to REACH the people who COUNT than to COUNT the people you REACH The Segmentation Principle
  6. 6. Segmentation Sophistication 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 6 Just eat it: we know what’s good for you. Fun for all the family. (If you all fit these 4 buckets) Completely personalised. (If you play guitar for Blur)
  7. 7. GA Value Segmentation Average Transaction Value only defines the immediate value of a single session Value Segmentation looks at the longer term value of a user (customer) 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 7
  8. 8. GA Value Segmentation • Choose some buckets (max 4) 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 8 Segment No Value Low Value Medium Value High Value Definition No Purchases Exactly 1 Purchase Exactly 2 Purchases 3 or More Purchases
  9. 9. GA Value Segmentation • Apply segments to reporting 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 9
  10. 10. Digital Segmentation Party One of richest sets of behavioural data Some of the least sophisticated segmentation on the planet 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 10 Key Challenge: Think of an interesting question Then try again… And again…
  11. 11. Direct Mail Segmentation Party Limited behavioural data Nice clustering algorithms 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 11 Key Challenge Getting the data to model
  12. 12. Clustering (Segmentation Modelling) 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 12 Cluster analysis or clustering is the task of grouping a set of objects in such a way that objects in the same group (called a cluster) are more similar to each other than to those in other groups (clusters).
  13. 13. Real Advanced Segmentation • Unsupervised learning – The algorithm helps find relationships/outcomes you didn’t already know about • Anchored on profit – Not a value hunch • Statistically based – Extracts the signal from the noise 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 13
  14. 14. Creating Clever Clusters 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 14 BEHAVIOURAL DEMOGRAPHIC VALUE PSYCHOGRAPHIC GEOGRAPHIC OFFER BASED BENEFIT BASED
  15. 15. 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 15 Let’s talk money
  16. 16. Example: Car Rental 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 16 High Value High Potential High Value Low Potential Low Value Low Potential Low Value High Potential Value Potential Customer Rental Records Current Value Rental revenue vs cost over past 12 months Expected Value Basic model based on recency / frequency
  17. 17. Example: Car Rental 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 17 Clustered By Membership scheme Age Gender Car group rented Pickup locations Rental duration Time of year Business / leisure profile … “High value customers tend to rent car groups K, F, L, Z, older demographic, less corporate, different pick-up/drop- off locations” “Frequent renters tended to be short haul for business and standard domestic, male, aged 36-56 ” High Value High Potential High Value Low Potential Low Value Low Potential Low Value High Potential Value Potential
  18. 18. Example: Car Rental Target relevant offers to encourage low value / high potential group 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 18 Focus upgrade offers and also loyalty / retention offers to high value / high potential group Marketing options
  19. 19. Outcome £6m incremental revenue over 18 months
  20. 20. Example: Home Insurance Have a Policy Cancel Renew
  21. 21. Example: Home Insurance Have a Policy Cancel Renew 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 21 • Length of relationship (summarised transactional data) • Satisfaction level (scores from research) • Number of quotes • Age of policy • Level of cover • Additional covers taken • Price • Payment method • Number of claims • Demographics • Number of products held • Ratings district • Home details (e.g. year built) • Financial position (e.g. overlay of Experian data)
  22. 22. Example: Home Insurance 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 22 • Length of relationship (summarised transactional data) • Satisfaction level (scores from research) • Number of quotes • Age of policy • Level of cover • Additional covers taken • Price • Payment method • Number of claims • Demographics • Number of products held • Ratings district • Home details (e.g. year built) • Financial position (e.g. overlay of Experian data) Have a Policy Cancel Renew
  23. 23. 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 23 Test and target retention campaigns on segments with the highest likelihood of success E.g. targeted renewal discounts Identify high value segments with high probability of lapsing and focus efforts on them E.g. getting onto direct debit Marketing Actions Outcome 30% increase in retention.
  24. 24. Analytics Ecosystem 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 24
  25. 25. Analytics Ecosystem 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 25
  26. 26. Analytics Ecosystem 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 26
  27. 27. Analytics Ecosystem 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 27
  28. 28. Digital Clustering Opportunities 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 28
  29. 29. 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 29 Useful Tools. Not this!
  30. 30. Tool Time 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 30 Rstudio http://www.rstudio.com/ Rattle http://rattle.togaware.com/
  31. 31. Tool Time 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 31 KNIME http://www.knime.org
  32. 32. Handy Tool links • R Integrations – http://skardhamar.github.io/rga/ – https://code.google.com/p/r-google-analytics/ – http://randyzwitch.com/rsitecatalyst/ 13 April 2015 © Lynchpin Analytics Limited, All Rights Reserved 32
  33. 33. Stats Tutorials – http://www.autonlab.org/tutorials/ – http://rattle.togaware.com/rattle-examples.html Handy Tutorial links
  34. 34. Andrew Hood Managing Director @lynchpin www.Lynchpin.com Cheers Folks www.linkedin.com/in/andrewhood
  • YiMon4

    Mar. 27, 2018
  • dowlingtasha

    Apr. 22, 2015

Data modelling presentation by Andrew Hood, MD of Lynchpin . Creating clusters in data to target and predict behaviour for profit. There are some handy links for tools including R and rattle.

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