Business Analytics for Sales and Marketing Managers: How to Compete in the Information Age

FINDING THE MOST VALUABLE CAMPAIGNS

This section was written for processes owners who want to optimize their existing retention activities and have DW information about which customers were contacted when, by which campaign, and whether the customer still is active or not. The aim of this section is to show how you can identify which campaigns are the most valuable for your company from a return on investment (ROI) perspective.

Exhibit 6.6 shows a ROI diagram, which is a visual presentation of the different costs and value drivers that you need to identify to be able to estimate the value of your individual retention activities. This ROI tree is similar to the one presented in Chapter 5 (Exhibit 5.2), where you also can read about how to estimate its individual element costs and benefits in more detail. The difference is that the effects of retention campaigns in regard to the ROI primarily will be manifested through the increased lifetime, which is what this chapter is about, whereas the effect of cross- and up-selling typically can be measured via increased profits or volumes.

Exhibit 6.6 ROI Tree