Bob Thompson chats with predictive analytics expert Eric Siegel about:
Recorded on Jan. 30, 2009.
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It's hard to pick up a newspaper these days without seeing companies cutting more costs. Part of this story is that companies are shifting their spending to invest in a new flavor of business intelligence technology that predicts the buying behavior of each customer or prospect - predictive analytics.
Predictively modeling customer response provides something completely different from standard business reporting and sales forecasting: actionable predictions for each customer. These per-customer predictions are key to allocating marketing and sales resources. By predicting which customer will respond to which offer, you can better target to each customer.
As your company prepares to deploy a predictive model, there are best practices that avert the risk the model won't perform up to par. Here are three guidelines to ensure this risk is minimized.
1. Don't evaluate the predictive model over the same data you used to create it.
When evaluating a...
