Determination of Target Groups for a new product or service

 

Data Mining tools that can perform automatic discovery (such as DECISION FORCE or others) are suitable for customer targeting.

It only requires a sample of past consumers, each of which is described by his/her profile characteristics and his/her positive or negative response to the company’s previous campaign.

Receiving this sample as input, the program can generate, in a few seconds, a model that segments the consumer population into distinct target groups.

The above model can be used for predicting whether a population member will be a likely customer of the company’s products or not.

The major advantages of Data Mining in Targeting new Customers, are:

 

  • Targeting Method saves time and money.
  • It enables the company to adopt a higher quality marketing campaign towards its likely customers and customise it so as to be better suited to their particular needs.
  • It has been observed that the adoption of such targeting methods can raise the response rate of a direct marketing campaign from 1% to 15% or even 20% . In addition, such methods can increase the company profits by 5% to 10% and at the same time reduce the marketing cost by 30% to 40%.