Study of cases
- Chapter 3: Segmentation and targeting
- Case problem:
- How to find key drivers of customers' choice on products based survey data of customer preference and their choice
- How to win loyalty of customer and how to reduce customer churn rate based on key driver found in above questions
- Case solution:
- Use logit model to derive relationship between propensity to buy with their preference on features
- Cluster customer based on propensity to buy. Focus on competitive customer (slight prefer ABB product instead of competitors) and switchable customers (slight prefer ABB's competitor product instead of ABB's and ABB is the second)
- Based on the formula, find independent variable with statistic significance
- Investigate impact of these key drives to competitive customer and switchable customers and figure out how to win loyalty of customer and how to reduce customer churn rate
- Why the author put this case after the chapter
- Customer segmentation based on propensity to buy is very useful to identify customers that worth sales' efforts on them
- How can the case be implemented into real situation
- It might not be easy to identify a few variable that really represent customers' attitude toward the product. The starting point might a find key variable from lots of variables through ANOVA.
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