CRM Project
Campaign Planning & Engineering
Increasing Loyalty by Selling Mobile Broadband
Products
Dr. Evangelos Xevelonakis
Defining The Business Problem
A Mobile Telecommunication Company has the strategic goal to reduce churn by
selling mobile broadband products (Speed, Live TV, MP3-Songs). The retention
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 Fun & Action (70 000)
The Progressives (40 000)
Progressive
scene
Fun and
Action NW
Materialistic,
Extroverted
N
W
O
SW
Bourgeois
Alternative
way of living
NO
Idealistic,
Introverted
SO
S
Religious
Patriotic,
Conservative
Fun & Action customers are young looking for fun and love to contact people. They
have a vocational education and live in the city. They could be influenced by friends,
colleagues and TV.
Progressives 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.
2
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%
120%
100%
Customers
80%
60%
40%
20%
0%
1
2
3
4
5
6
7
8
9
10
Target Group
Response Rate With No Model
Response Rate Using a Model
The picture compares the performance of a customer selection using the predictive model with the performance
of a random selection.
3
Designing the Customer Program
Within the strategic planning the company decided to carry out two customer campaigns:
one for the Fun & Actions and one for the Progressives. The developed predictive model
should be used for defining the target group. Following parameters could be used for this
purpose:
Campaign „ Fun & Action“
- Cost for Call Center
- expected Take Rate
- Margin
- Cost of the addresses
- Costs for the Incentive
- expected customer revenue
€ 7.— per Contact
4%
25%
€ 0.4.– per Address
€ 40.– per new contract
€1500.--- per Year
Campaign „Progressives“
The decision was to carry out a two step campaign:
- Costs for Direct Mail
€ 4.-- Cost for the Call Center
€ 7.-- expected Take Rate
2%
- Margin
25%
- Cost of the addresses
€ 0.4.– per Address
- expected customer revenue
€. 2000.—
4
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
5
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?
6