Targeting customers for profit: An ensemble learning framework to support marketing decision-making

Stefan Lessmann, Kristof Coussement (), Koen W. de Bock () and Johannes Haupt
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Kristof Coussement: LEM - Lille économie management - UMR 9221 - UA - Université d'Artois - UCL - Université catholique de Lille - Université de Lille - CNRS - Centre National de la Recherche Scientifique
Koen W. de Bock: Audencia Recherche - Audencia Business School

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Abstract: Marketing messages are most effective if they reach the right customers. Deciding which customers to contact is an important task in campaign planning. The paper focuses on empirical targeting models. We argue that common practices to develop such models do not account sufficiently for business goals. To remedy this, we propose profit-conscious ensemble selection, a modeling framework that integrates statistical learning principles and business objectives in the form of campaign profit maximization. Studying the interplay between data-driven learning methods and their business value in real-world application contexts, the paper contributes to the emerging field of profit analytics and provides original insights how to implement profit analytics in marketing. The paper also estimates the degree to which profit-concious modeling adds to the bottom line. The results of a comprehensive empirical study confirm the business value of the proposed ensemble learning framework in that it recommends substantially more profitable target groups than several benchmarks.

Date: 2019-05-21
New Economics Papers: this item is included in nep-cmp
Note: View the original document on HAL open archive server: https://audencia.hal.science/hal-02275955
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Citations: View citations in EconPapers (6)

Published in Information Sciences, 2019, ⟨10.1016/j.ins.2019.05.027⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02275955

DOI: 10.1016/j.ins.2019.05.027

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