Customization test for the car insurance mailing campaign of a leading multinational Insurance company.
Main test characteristics
A Life and P&C insurance company with a worldwide presence in more than 80 countries and tens of millions of customers.
Quantify the actual impact on overall profitability of different customization attributes (communication only) in the car insurance mailings sent to existing customers, and identify the customization level which offers the best redemption-to-production cost ratio.
Three dimensions (customization according to socio-demo variables, customization according to recent customer behaviour, customization according to products owned) and 2 to 3 values for each dimension, corresponding to a total of 18 combinations (3x2x3).
Only 6 test cells launched on the market to simulate the results of these 18 combinations.
180.000 customers representative of the overall population in database without any running car insurance product. Each of the 6 test cells has been populated with 25.000 customers, presenting the same characteristics than the total population of the test. The “standard” cell (without customization) has been populated with 30.000 additional customers.
Final test results
After 3 months, the extrapolation of the results observed on the 6 test cells led to the identification of an optimal customization level, ie. the one with the higher positive gap between additional revenues and additional costs per contact. Concretely, the associated combination offered +29% in revenues, for an additional cost of +40%. In this case, the Cost/Income of the campaign decreased a little bit but the overall profit increased by +18%.
Ranking of all combinations, based on revenues and profit increase compared to the standard offer (no customization)