INCENTIVES: DO THEY WORK?
Increase unsecured loans.
The client wanted to determine whether a cash incentive to entice pre-qualified members to purchase would work better than a segmented list without an incentive.
A group of 18,000 members was first pre-qualified based on a series of criteria designed to find those members with loans outside the institution. Based on that analysis, we believed we could save customers money with a refinance offer. A group was split evenly into two segments. 50% of the group received a pre-qualified offer with a $25 gift card incentive. The second group was segmented based on life stage modeling and divided into four groups. They were not offered an incentive.
The non-incentive highly-segmented life stage group generated 78% of the responses. With any test, to validate the results one should retest and re-validate. Clearly, highly segmented and personal communications are dramatically more important than incentives.
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