The commercial use of segmentation and predictive modeling techniques for database marketing in the Netherlands

The results indicate that the application of segmentation and response modeling is positively related to company and database size, frequency of customer contact, and the use of a direct channel of distribution.

Abstract

Although the application of segmentation and predictive modeling is an important topic in the database marketing (DBM) literature, no study has yet investigated the extent of adoption of these techniques. We present the results of a Dutch survey involving 228 database marketing companies. We find that managers tend to rely on intuition and on the long-standing methods RFM and cross-tabulation. Our results indicate that the application of segmentation and response modeling is positively related to company and database size, frequency of customer contact, and the use of a direct channel of distribution. The respondents indicate that future research should focus on models applicable for Internet marketing, long-term effects of direct marketing, irritation from direct marketing offers, and segmentation and predictive modeling techniques.