Predictive analytics uses data from the past to predict outcomes in the future. It can be used to determine customer lifetime value, provide product recommendations, and forecast sales. The analysis is done by creating a customer data warehouse with purchase histories and then applying statistical techniques like regression analysis to identify patterns and create predictive scores and models. However, the assumptions made may become invalid over time if key variables are not included or as time passes. For Indian managers, predictive analytics can help optimize marketing campaigns and improve operations by forecasting inventory needs. To implement it successfully, companies need to gather the right data, use the appropriate statistical models, and pay attention to the assumptions made.

1. A Predictive Analytics
Prime
By Srijani Das

2. No one has the ability to
capture and analyze data from
the future.

3. Here comes Predictive Analytics
To predict future using
data from past

4. Important insights

5. Forms of predictive analytics
Customer
lifetime value
Product
recommendation
capability
Forecast of next
quarter’s sales

6. That’s using predictive analytics to determine how much a
customer will buy from the company over time.

7. That’s product recommendation
capability, an analytical prediction
of the product or service that your
customer is most likely to buy next.
forecast of the level of
sales you expect to
achieve.

8. The quantitative analysis isn’t magic, it is normally
done with a lot of past data, a little statistical
wizardry and some important assumptions

9. Create customer data warehouse
with unique customer IDs on
everyone, and all past purchases
customers have made through all
channels.
The Data

10. The Statistics
Using Regression equation and
regression coefficients analyst can
trace the purchase behavior to
create a score predicting the
likelihood of the purchase.

11. The Assumptions
the future will continue to
be like the past.
What make assumptions
invalid?
1. Time
2. If key variable is not
included in model.

12. How relevant to
Indian Manager?

13. Optimizing marketing
campaigns :
• To determine customer
responses or purchases, promote
cross-sell opportunities.
• To help businesses attract, retain
and grow their most profitable
customers.

14. Improving operations
Companies use predictive
models to forecast inventory
and manage resources.

15. So what’s now?
• Gather right data.
• do the right type of
statistical model.
• be careful of our
assumptions.