So, You Can Predict Customer Behavior...Now What?
Prior to my current tour at TRC I was a partner at a small data mining boutique that had a simple objective: support the sales and marketing goals of our clients by helping them stem attrition. While the goal may have been simple, how we set out to do this was not. See, we took upwards of 30 months of time-series data on all of their customers and applied some mind-numbing statistical techniques that identified patterns in the data that preceded an eventual behavior. In most cases that behavior was a customer terminating their relationship with our client. Once our system identified the patterns that preceded attrition, we would then continue to feed it customer data each month and it would dutifully output a list of customers that were likely candidates to attrite. In addition, for each customer on this golden list we provided the prediction "trigger", or the thing that they did that was responsible for the system flagging them as a high-risk customer.
