The following is a hypothetical case study involving a financial company's credit card division that wishes to reduce the number of customers switching services. To achieve this, marketing management decides to initiate a data mining project to help predict which customers are likely to switch services. These customers will be targeted with an aggressive direct marketing campaign. The following is a summarized plan for accomplishing this objective.
The credit card division would like to increase revenues by $2,000,000 per year by retaining more customers. This goal could be achieved if the division could predict with a 70% accuracy rate which customers are going to change services. The 70% accuracy number is based on a financial model described in a separate report. In addition, factors that are likely to lead to customers changing service will be useful in formulating future marketing plans.
To accomplish this business objective, a data mining project is established to solve the following problems:
The target population is all credit card customers.
There will be two deliverables: