A Resource-Allocation Perspective for Marketing Analytics
Dunia Finance LLC, the midsize financial services firm in the United Arab Emirates (UAE), gains most of its customers through door-to-door sales. This makes the cost of obtaining new customers high. So the company needed to look at new ways of allocating its resources to improve its results. It decided to focus on cross-selling to existing customers to increase their customer lifetime value (CLV).
It was up to Dunia to apply a resource-allocation framework to pinpoint the best groups of customers for cross-selling. Any customer who had opted out of promotional offers was excluded. Customers close to reaching their credit card limit would be targeted for a loan. For those who had personal loans, Dunia could offer solutions based on loan type for problems the customers didn’t even recognize they had.
Resource allocation is the endgame of analytics for any company. Using marketing analytics properly, any firm (not just financial services providers such as Dunia) should be able to determine the optimal level of spending it should make on each of its marketing channels to maximize success.