why predictive analytics should be part of your strategy (3)
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Why You Should Make Predictive Analytics Part of Your Strategy!!!
There are many reasons why predictive analytics should be a high priority
for your company’s strategy. The competitive landscape is changing
every day and customers’ access to competitor information is driving
thinner margins in most verticals. Customers have become more
demanding and selective, and have more choices. It is clear from research
that companies thriving in the new global digital environment are those
that are willing to adapt to change and willing to innovate ahead of their
competition. Those companies that are more agile, leaner, and quicker to
anticipate the market needs have embraced predictive analytics.
What is Predictive Analytics?
Let’s start talking about predictive analytics with a simple but important question: What is Predictive Analytics?
Predictive Analytics examines patterns found in internal and external data to identify future risks and opportunities.
It is necessary to clarify that predictive analytics is not only about predictions or the future. Predictive analytics also
offers more data analysis and data mining capabilities to identify patterns where potential issues and opportunities
exist. Predictive analytics has the ability to drive innovation in most areas of your business.
What Could You Do To Benefit the Most from Predictive Analytics?
With the dynamics in the marketplace, there are many areas in marketing such as, cross-sell, up-sell, customer
retention, direct marketing, pricing and customer relationship management (CRM) that could benefit from data
analysis. Other potential areas where predictive analytics has had a major impact are: risk assessment and
management, fraud detection, disease prevention and disease management. Some of the leading companies that
have embraced predictive analytics in all aspects of their business are Amazon, Netflix, LinkedIn and Facebook.
Amazon and Netflix have been using predictive analytics almost from the beginning, about two decades, to drive
sales through recommendation engines and customer satisfaction. LinkedIn and Facebook have been around for
about a decade and use predictive analytics in almost all aspects of their business decisions. Although these
companies are relatively new in comparison to blue-chip giants like Walmart and IBM, they are now some of the
biggest companies in the world. Why? Because these companies have pioneered the use of predictive analytics in
managing customer relationships and target marketing. If these examples are too “abstract” then following are real
life examples of what Dunn Solutions Group (DSG) has done for its clients!
Chicago Minneapolis Raleigh Bangalore
www.dunnsolutions.com (847) 673-0900
How Using Predictive Analytics Has Made Our Clients Become More Profitable
Client: Online Mass Retailor
Business Area: Cross-sell, Up-sell
Challenge: Online Mass Retailer was missing out on the opportunity to add additional
revenue by providing differentiated customer experiences, and by offering the right items
in the right order to increase cross-selling opportunities.
Solution: Identified optimal product mix and cross-sell offering. Helped to customize the
consumer experience and optimize revenue through more revenue per customer.
Result: Recurring annual benefits of more than $80M in additional cross-sell revenue and
an average increase of $.94 per customer purchase.
Client: Fortune 100 Insurance Company
Business Area: Target Marketing, Product Performance Simulation, Pricing
Challenge: A subsidiary of a Fortune 100 insurance company provides health insurance
services in 29 states and was facing specific new competition. Products were underpriced
for claims experience. Larger competitors were quickly gaining market share.
Solution: Performed Segmentation of Customers. Developed Forecasting Simulation Tool
to predict product performance. Developed Marketing Mix and Market Potential. Market
based assessments to better target customers.
Result: Transformed the subsidiary into the fastest growing individual health insurance
company in the nation at a time when most in the industry were shrinking. Doubled the portfolio with targeted high-
value customers in just 18 months to over 370,000 customers and $500 million in new annual revenue.
Client: Top 10 U.S. Bank
Business Area: Operational Optimization, Intervention Modeling
Challenge: Top 10 U.S. Bank faced with mounting delinquencies in all banking areas. A
huge backlog of foreclosures.
Solution: Designed a predictive analytics modeling engine and dashboard reporting
environment that tracked all consumer lending and mortgages. Tracked customers through
models to help determine when and what action best fit the situation. Developed staffing
and capacity planning models for collections and default.
Result: Generated models on defaulting loans which justified an additional $2.2 billion in TARP money. Used
targeted messaging to better handle the collections and default, saving $9 million each month in call center
performance. Increased collections and curing by 25% through better customer risk targeting, collecting an
additional $40M each month.
Chicago Minneapolis Raleigh Bangalore
www.dunnsolutions.com (847) 673-0900
Client: Higher Education
Business Area: Student/Customer Retention Analysis
Challenge: A large online higher education organization was facing ever increasing student
churn.
Solution: Identified key drivers that were causing higher than normal student churn.
Developed a series of intervention and reacquisition models for admissions and professors
that identified key drivers that contribute to student churn at critical points in time to save
the student.
Result: This drove a project ROI of 328 times the cost of the project, a 15% student retention from intervention five
year program, and one time 5% reactivation campaign of inactive students.
How Dunn Solutions Group Helps You Have The Competitive Advantage?
There are many competitive advantages to gain by using predictive analytics and Dunn Solutions Group expertise.
Why fall behind when leading companies are thriving because they use predictive analytics and Dunn Solutions
Group? Why Dunn Solutions Group for Predictive Analytics? Because most firms use a cookie cutter approach and
return an average of only $10.66 for every dollar spent. We are different!!! We pride ourselves on getting to know
your business, your issues, and your challenges. We have found more success for our clients by understanding what
is needed and how to implement it. Feel free to contact Jeff Goffinet, Director of Sales at (847) 673-0900 x 104 or
[email protected] to take advantage of our ability to help our customers return an average of $100
dollars for every dollar spent on predictive analytics.
Solutions Retention and
Intervention Models
Churn Modeling
Customer Lifetime Value
Analytics