Is it true Propensity Scores can predict human behavior? Yes, absolutely – let me explain. In marketing analytics, propensity scores refer to a person’s natural tendency or disposition to respond to direct marketing campaigns. Therefore, it can predict human behavior, which in turn can help marketers craft personalized messages that increase the ROI of direct marketing campaigns (click here to read through our first series on propensity scores).
Personalized content is the missing link between propensity scores and executing successful marketing campaigns. As discussed in the first 3 parts of our Propensity Series, the use of Propensity Scores is a marketer’s golden ticket to paradise because it has proven to increase an organization’s bottom line in two ways:
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Organizations always dream of doing “more with less”, especially when focusing on improving customer profitability. But they can’t seem to turn that dream into reality. One of the main reasons why is that they are spending just as much time and energy marketing to customers who are least likely to respond as they do on those who are most likely to respond. This is a HUGE problem because organizations could substantially reduce marketing costs by focusing exclusively on 1) those already in their system who have a high likelihood of responding and 2) like-minded prospects outside of their current database. We at Arjuna have a solution to this problem - PROPENSITY SCORES. Let me explain further.
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As executives, entrepreneurs and marketers, we’re constantly trying to find innovative ways to increase revenues, cut costs, and increase customer profitability. And with so much information rushing in from CRM systems, email marketing, call centers, web analytics, and more, a lot of marketers are looking to cash in using predictive analytics and big data.