Segmenting of customer lists is a great use of predictive models. The more segments in an organisation’s customer list, the better they can customise their marketing and therefore the more meaningful these communications become.
Predictive Models in segmentation
Most marketing analytics do not go beyond demographic, psychographic, behavioural and benefit segmentation. A predictive model can be used to judge the chances of a customer taking a particular action, usually a purchase. A model might look out for opportunities around cross-selling, vertical selling and customer churn.
"Customer segmentation and Predictive Modelling aren’t mutually exclusive. In fact, they’re two important pieces of the same process."
Jim Head, Director of Analytics @ BKV