1. Visit EWA Bespoke Communications at www.ewa.ltd.uk/ to learn more about its Customer Insight services and the types of analyses performed by this company. What is propensity modeling? Review other case studies from this Web site and write a brief report of how data-mining technology was used to gain customer insights.
2. Describe how other organizations can benefit from these types of data-mining analyses. Find examples of other companies that can offer such analysis to businesses.
In 1996, Marks & Spencer (M&S), the venerable British retailer, launched "lunch to go"-an online corporate catering service (see www.lunchtogo-e.com/). But M&S found it difficult to develop long-term relationships with corporate customers due to high personnel turnover within customer organizations, so it turned to EWA Bespoke Communications, a company that uses data mining to "tell you more about your customers." EWA used "propensity modeling" to develop a "critical lag" formula that identified customers whose last order fell outside of their expected behavior. EWA then developed an automated system to send communications to customers who did not reorder within the maximum allowed order lag determined by the formula whereas most customers received e-mails, the system flagged M&S's best corporate catering customers who should receive more personalized phone calls because of their value and importance. EWA also implemented information systems to improve the company's service. Knowing more about its customers paid off-within a short period of time, the EWA system generated more than £1 million, tripling the operation's revenues, and delivered an almost perfect order-accuracy rate. was used to gain customer insights.