November 18, 2007

More On Modified RFM For E-Mail Targeting

Many wonder what to do when you have two potential versions of an e-mail campaign. Which version should a customer receive?

Companies loaded with analytical talent have interesting algorithms to make these decisions. Yesterday, we talked about a shortcut that gets us 80% of the benefit for about 5% of the work.

But what do you do when one version of an e-mail campaign is so much more productive than another? In other words, say you have a Mens and Womens version of an e-mail campaign, and the customer could receive either version, but the Mens version is much less productive (sales per e-mail) than the Womens version?

A shortcut is to evaluate the historical difference in productivity, and apply that to the "weighting" score from yesterday's post. In other words, if the Mens version performs at 65% the level of a Womens version, multiply your Mens weighting scheme by 65%.

Again, this is statistical blasphemy. But you don't work at a company where you have thirteen statisticians sitting around waiting for new and exciting challenges. You're lucky to have one good analyst, and the demands upon this person's time are many. So take the shortcut, and get 80% of the benefit for 5% of the work. And when you have the money and/or human resources to do e-mail targeting the right way, by all means, pursue the ideal answer.


  1. Anonymous4:56 PM

    Kevin, this is great stuff.

    I'm all for being "a little “less scientific” on the Technical side and a little “more specific” on the Marketing side". We're much more productive when we all meet in the middle...

    We're indeed not trying to cure cancer, and with all apologies to the highly qualified and extremely bright stats people out there, Marketing is not ever going to be a science.

    Please do all you can to "hide the wires" and get more Marketing folks to adopt statistical (or psuedo-statistical) analysis rather than run from it!

  2. Psuedo-statistical is a good way to describe these methods.

    It works better than doing nothing, it improves the performance of an e-mail campaign, and it isn't terribly difficult to do.

    Most important, it is better than doing nothing!


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