Case Study - Publishing Example
Problem
A publishing client was interested in improving the expected long term value of new customers during their acquisition efforts. Current methods were successful at attaining new prospects, but fairly often, the tenure of these newly acquired customers was not sufficiently long enough to recover the cost of acquiring them. Transaction level revenue and subs renewal data were provided along with third part data appends.
Revenue during first 12 months as a subscriber was also provided.
A publishing client was interested in improving the expected long term value of new customers during their acquisition efforts. Current methods were successful at attaining new prospects, but fairly often, the tenure of these newly acquired customers was not sufficiently long enough to recover the cost of acquiring them. Transaction level revenue and subs renewal data were provided along with third part data appends.
Revenue during first 12 months as a subscriber was also provided.
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Solution
A prospect level hazard model was created to explain attrition risk as a function of demographic and third part behavioral data. A second model to predict 12 month revenue was also developed. The models were used to determine likelihood of attrition, time of attrition, and twelve month expected revenue. Recommendations were made to solicit prospects whose expected revenue and tenure were sufficiently large enough to exceed acquisition costs by client’s internal threshold. |
Tenure of Attrited Customer
Attrition Rates
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