Database Marketing Propensity Model

Situation: A large international insurance client engaged Convergence Group to develop several multinomial logistic regression models to improve targeting for customer and non-customer auto insurance marketing campaigns. There was a need to dramatically reduce marketing expense while maintaining a high volume of new policies.

Solution: Convergence Group used rich customer and non-customer transactional level data to develop a score, which predicts the likelihood to purchase auto insurance when stimulated by direct marketing campaigns. This score was used to reduce cost while generating maximum ROI.

Result: Convergence Group developed, deployed and validated models that increased response by 50% and reduced marketing cost by 45%. Subsequent models were developed for additional products including home, pet, and travel after the successful implementation of auto.