The magic of House
Intrigued by the title? Do you wonder what marketing wizards like Don Draper, Roger Sterling and Pete Campbell from Mad Men could possibly learn from Dr. House? Well, I bet statistics would probably not be the first thing to come to mind. Yet still, this is exactly what those marketing wizards could use to improve their campaigns! Even more so, every true marketeer should be intrigued by the topic of ‘Survival Analysis’.
Now, what is survival analysis exactly? Simply stated, it’s a statistical approach to model events. These events can be all sorts of things, some interesting analytical datapoints can be: a churning customer, the purchase of a second product, a thesis finished in time, a patient that dies, etc. In any case, the outcome to model is very strict: Either it happens, or it doesn’t. Although there are many other statistical techniques available to deal with this type of binary outcome, survival analysis is the one able to take into account the important concept of… time.
Let’s say that you perform a segmented campaign on two separate customer samples. After twelve months you evaluate your model setup and you come to the conclusion that sample A clearly performs best. However, when you analyse the exact same campaign again six months later - so after 18 months in total - the effect has disappeared and the success rate for both samples is again at similar levels. Which conclusion is then the right one? Looking at these two distinct pictures the conclusion might be unclear, causing confusion about the effectiveness of your campaign.
This is where Dr. House comes into play with his analytical appoach! Whereas traditional evaluation methods are based on ‘one shot pictures’, survival analysis can provide you with the whole movie by also evaluating the evolution of the success rate through time, allowing for a single, accurate statistical conclusion.
This technique is often applied in the medical world, but among people without a medical background it is still rather unknown. Yet still, the added value of this analytical technique in a business setting has clearly been proven in a number of academic papers.
In case you would still doubt it; watching Dr House really can make you smarter! At 4C Consulting we believe survival analysis can improve your insights about the effectiveness of marketing programs, business strategies or segmented approaches. We hope you enjoyed the topic and are curious to dive a little deeper into the field of statistics and analytics. You can download our presentation on the topic here.
Feel free to contact us to discuss analytical opportunities in your business and see you on our next breakfast seminar… at 7h30 AM!