Tatras helped us target the high value customer acquisition opportunities while still reducing wasted marketing spend. Tatras has given us the intellectual and implementation firepower to outperform our competition in the market place.
It’s been a game changer for our organization!
Our client, a US-based ecommerce player, was facing a squeeze on profitability, given rising cost of acquisition through digital marketing on one hand, and having to drop prices due to competitive pressures on the other hand.
Typically, digital marketing spend is evaluated by looking at profitability per transaction. Our approach was to not only look at profitability but also use customer lifetime value (CLV) as the basis of evaluating profits and determining the cost of acquisition.
Our data scientist examined the cost of acquisition through the lens of Customer Life Time Value (CLV)
- Customer transactional behavior analyzed to segment customers.
- Customer segmentation and historical transaction data used to build a model to predict the expected CLV of new acquisitions.
- Expected CLV correlated with digital marketing ads.
Rules Engine was deployed to include the above parameters and autonomously change bids within digital marketing channels.
The final algorithm also tracked the effect of changes on digital marketing performance to continuously improve rules for bidding.
TECHNIQUES, TECHNOLOGIES, TOOLS
- Survival Analysis, Clustering, Regression, R, Java
Tatras created an Autonomous Bid Management System based on expected CLV and digital marketing performance data.
This resulted in a 30% reduction in marketing budget waste while extending Customer Life Time Value by 12%, within a few months itself.