Propensity Models
Once the data are well understood, modeling will begin. If there is a stable and robust response variable present, then a Logistic Regression or other kind of model is a logical next step, assigning a loyalty or lifetime value score to each record.Depending on the modeling objective and the available response variable(s), modeling efforts may result in:
- Response Models
- Revenue/Profit Models
- Retention/Loyalty/Persistency Models
- Lifetime Value Models
- In the event where a Marketing history is not available for a given Product or Product Class, latent variable analysis (an extension of exploratory analysis) can also be used to generate a propensity model