6. Churn Analysis (Investment Startup)
Background
The customer segmentation for the thematic campaign is already done. However, after a few days, the marketing team informs that they only have a budget for the campaign equivalent to 30% of the total users in each segment. Therefore, they are seeking help to determine who will be targeted within the budget limitations and assess the projected profitability of the campaign. The cost per campaign is Rp. 1,000, and the transaction fee for both buying and selling is 0.15%.
Problem Definition
Within the budget limitations, not all users in each segment will be targeted for the campaign. As the data analyst in this investment startup, I need to analyze and select 30% of the users from each segment to be targeted, and then calculate the profit of the campaign when choosing those users/clients.
Objective
Use logistic regression to create a model that can predict whether existing users will participate in the campaign or not
Identify users with the top 30% predicted probability (tend to act after campaign)
Analyze the benefit-cost ratio to assess the profitability of the campaign
Task & Actions
Result
A regression model was used to identify the top 30% of users in each segment with the highest predicted probability to act on the campaign. However, the expected revenue is minus. To address this issue, the company can increase transaction fees or reduce campaign costs to generate higher revenue.
