Business Knowledge Series course

Presented by Terry Woodfield, Ph.D., Analytical Training Consultant, Education Division, SAS

The true effectiveness of a marketing campaign is not the response rate; it is the incremental impact. That is, true effectiveness is additional revenue, directly attributable to the campaign, that would not otherwise have been generated. The problem is that targeting strategies often are not designed to maximize the incremental impact. Typical targeting models are successful at finding clients who are interested in the product, but too often these clients would have bought the product regardless of whether they received a promotion. In such cases, the incremental impact is insignificant, and marketing dollars could have been spent elsewhere. Incremental lift models are designed to maximize incremental impact (that is, the incremental lift over the control group) by targeting the undecided clients who can be motivated by marketing.

The self-study e-learning includes:

• Annotatable course notes in PDF format.
• Virtual lab time to practice.

Learn how to

• Build incremental lift models that maximize the difference in response rates between the clients who receive the offer and their control group.
• Identify good incremental lift predictive variables.
• Build incremental lift models using a variety of techniques.
• Deploy incremental models.

Who should attend

Statisticians, business analysts, and market researchers who build predictive models for marketing and retention campaigns

Formats available	Duration
Classroom:	1 day

Before attending this course, you should:

• Have experience using SAS/STAT software to build statistical models.
• Have experience using SAS/STAT to build predictive models. You can gain this experience by taking the Predictive Modeling Using Logistic Regression course.
• Have experience with linear regression and logistic regression. You can gain this experience by taking the Statistics 1: Introduction to ANOVA, Regression, and Logistic Regression course.

This course addresses SAS/STAT software.

What Are Incremental Lift Models and Why Do You Need Them?

• Incremental impact.
• Incremental lift models versus propensity models.

The Green Card Marketing Campaign

• Campaign details.
• The INCREMENTAL SAS macro.

The Weight of Evidence and the Information Value

• Introduction.
• Weight of evidence (WOE) and the information value (IV).
• Estimating WOE and IV.

Generalized Additive Models (GAM)

• Introduction.
• Casting GAMs as large GLMs.
• L1 and L2 penalty.
• Fitting penalized nonlinear GLMs with the elastic net using GLMSELECT.
• Creating partial impact plots from spline-based models.

Net Weight of Evidence and Net Information Value

• Introduction.
• The weight of evidence (WOE) and the information value (IV).
• Calculating WOE and IV.
• Extension to Net WOE and Net IV.
• Penalizing NWOE tables.
• The INFORMATION SAS macro.

Building Incremental Lift Models

• Introduction.
• Nonlinearity in incremental lift models.
• Double variance.
• regression-based incremental lift models (difference score models and probability decomposition models).
• Non-regression methods (KNN classifiers and tree-based models).