To arrive at a complete solution, we analysed the data of two different types of customers who re-joined LOVEFiLM: those who cancelled once the free trial period ended, and those who didn’t.
We created two propensity models for both groups to define which customers were high value and more likely to return for the long term (not just the free trial period). The models also forecast the acquisition cost per customer, maximising selection efficiency.
In addition, we looked at each customer’s previous usage so as to offer the most attractive package for them to come back to. The analysis also looked at viewing habits and personalised each communication by featuring new releases based on their favourite film genre.
This strategy has generated a 25% uplift in response and, overall, LOVEFiLM won back (and kept) an unprecedented 7% of its targeted customers.