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Data Mining
Data Mining Weekly Assignment 6: LIFT; CRM; AFFINITY POSITIONING; CROSS-SELLING AND ITS ETHICAL CONCERNS.

What is meant by the term “lift”? The term “lift” describes the improved performance of an exact or specific amount of effort on a modeled sampling, as opposed to a random sampling (Spang, 2010). In other words, if you are able to market via a model to say, a given number of random customers (e.g. 1000), and we expect that 50 of them would be successful, then a model that can generate 75 successes would have a 50 percent lift. “Lift” is possibly the most commonly metric used to measure targeting model performance in marketing applications – the purpose of which, is to identify a subgroup or target from a larger population (Coppock, 2002 and Spang, 2010). The subgroup targeted or target members selected are those who are most likely to respond positively to a marketing offer. As such, the model is doing well if as predicted – the response within the targeted section is much better than average when compared to the population as a whole. Lift then, is simply the ratio of these values: target response divided by average response (Coppock, 2002). “Lift Charts” and “Lift Curves” are terms often seen in direct marketing. To quickly define them here – a lift curve is a popular technique which assigns a “probability of responding” score when used in an attempt to determine who the likely responders from a population are.

“The lift curve helps us determine how effectively we can “skim the cream" by selecting a relatively small number of cases and getting a relatively large portion of the responders” (Keating, 2013).

A lift chart or a “Gains Chart” is a convenient summary of all the cumulative lift curves whereby all the information in these multiple classification matrices are turned into a graph (Keating, 2013 and Coppock, 2002).

What is Customer Relationship Management (CRM)?
“There is only one boss. The customer. And he can fire everybody in



References: Business Dictionary (2013). What is scalable? Definition and meaning. In BusinessDictionary.com - Online Business Dictionary. Retrieved February 25, 2013, from http://www.businessdictionary.com/definition/scalable.html Coppock, D Francis, P. T. (2008). Cross-Selling Your Hospital’s Capabilities. Clinical Laboratory Sales Training with Peter Francis. Retrieved February 26, 2013, from http://www.clinlabsales.com/pdf/Cross-Selling-092508.pdf Goodhue, D NRMLA - National Reverse Mortgage Lenders Association (2008). Ethics Advisory Opinion 2008-01: Ethical Advertising. NRMLA - National Reverse Mortgage Lenders Association Newsletter, 1-4. Olson, D., & Shi, Y Olson, D., & Shi, Y. (2005). Market Basket Analysis and Neural Networks. In Introduction to Business Data Mining (1st ed.). Irwin: McGraw-Hill . Onyx (2013) Spang, J. J. (2010). MI824: Data Mining. Boston College. Retrieved February 24, 2013, from https://www2.bc.edu/~spang/mi824/C9Notes.htm Tsai, T Writing, A. (2013). The Advantages of a CRM System. Small Business - Chron.com. Retrieved February 24, 2013, from http://smallbusiness.chron.com/advantages-crm-system-43409.html

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