Case Study
Client
United Marketing Group
Project
Acquire the Right Customers Efficiently
Background
UMG, a leader in marketing enhancement products and services, has established relationships with major credit card issuers. Specifically, they provide individual club and service programs, such as discount travel and entertainment clubs, credit card registration services, discount buying clubs, prepaid legal services, auto clubs, discount dental plans and more.
Each month, credit card issuers provide a file of customers that may be solicited by UMG. In some cases, UMG markets multiple clubs and services to each client's customer file. UMG recognized the need to work smarter and target the best prospects for the right club and service.
Objective
Develop a competitive edge for acquiring club and service members, using marketing dollars efficiently. Build statistical models that identify characteristics of people who are most likely to buy specific clubs or services, via specific channels, right now.
Execution
DataCo has built more than 60 custom response models to find the right prospects to purchase specific
club, service or fee-based card products. Each model is unique to a club, service of fee-based card, as well as marketing channel (i.e., telemarketing or direct mail). When the models are complete, DataCo provides UMG with a sensitivity analysis that compares Return on Investment (ROI) of contacting all increments of the file versus the entire customer file (i.e., 5% depth vs. 10% depth vs. 20% depth and so on). This sensitivity analysis is a decision support tool that tells UMG the optimum quantity of customers to market.
Results
Leveraging these models, UMG has improved ROI by an estimated 40-60% by reducing the number of direct mail pieces and telemarketing calls by 50% or more. Within the smaller marketed group, UMG is able to find 75-90% of those individuals who would buy versus contacting the entire customer file.
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