Marketing Offer Eligibility System Using Net Present Value Analysis
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Solution Overview
Problem
Financial services marketing campaigns lack efficiency in identifying optimal marketing offers, relying on indiscriminate mass mailings without considering factors like offer proximity and time degradation, leading to suboptimal return on investment.
Innovation Solution
A system and method for analyzing potential marketing offers to determine eligibility based on predetermined criteria at the household, prospect, and offer levels, calculating net present value and response rates, and dynamically updating input parameters to identify the best offer combinations for mailing, incorporating time-degradation factors.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Quantity of substance
If indiscriminate mass mailings are used, then coverage of prospects is achieved, but return on investment deteriorates
Solution Approach 1:
The patent applies local quality by transitioning from uniform mass mailing to personalized offer selection at the individual prospect level. The system evaluates each prospect's characteristics, household composition, and offer history to determine eligibility for specific offers, thereby optimizing the quality of each mailing rather than applying a blanket approach to all prospects.
Solution Approach 2:
The patent implements parameter changes by dynamically adjusting offer selection based on multiple variables including time degradation factors, prospect response history, household-level constraints, and offer proximity. These parameter changes enable the system to identify optimal offers that maximize return on investment while reducing unnecessary mailings.
2Measurement precision
If offer proximity and time degradation factors are considered, then offer selection accuracy is improved, but system complexity increases
Solution Approach 1:
The patent applies segmentation by breaking down the complex offer selection process into distinct evaluation layers: individual prospect-level criteria, household-level constraints, and offer-level parameters. This segmented approach manages complexity by organizing multiple factors into structured tiers that can be processed systematically.
Solution Approach 2:
The patent introduces an intermediary computational system that mediates between raw data inputs and final offer selection decisions. This intermediary layer processes time degradation factors, tracks offer proximity, and applies eligibility rules, thereby managing the complexity of multiple interacting factors through a centralized decision-making framework.
3Productivity
If prospect-level, household-level, and offer-level constraints are incorporated, then marketing efficiency is improved, but computational requirements increase
Solution Approach 1:
The patent applies preliminary action by pre-establishing eligibility criteria and constraints at three levels: prospect-level preferences and history, household-level limitations, and offer-level parameters. These preliminary filters are set before the actual offer selection process, enabling efficient computational processing by eliminating ineligible options early in the evaluation sequence.
Solution Approach 2:
The patent implements dynamics by making the offer selection system adaptive and time-sensitive. The system dynamically adjusts offer eligibility based on time degradation factors that change with each mailing wave, prospect response patterns, and evolving campaign objectives. This dynamic approach optimizes marketing efficiency while managing computational resources through intelligent updating rather than static processing.
Data Source
AI summary
The present invention provides for a system and method for identifying optimal marketing offers in a mass marketing campaign. An optimal offer for a particular prospect at a particular time in the multi-wave campaign is determined. In accordance with one embodiment of the present invention, offer information is initially collected for each of the various offers tagged for potential inclusion into a. Each offer is analyzed to determine its eligibility for inclusion in a marketing campaign to a particular household or individual prospect within a household. A systematic evaluation of eligibility applies a plurality of predetermined criteria to each offer on a household level, a prospect level and an offer level. In this manner, offers failing such criteria may be easily removed from inclusion in the campaign. A net present value (NPV) and a net response rate may be calculated for each eligible offer to identify one or more optimal marketing offers.