What is Propensity to Refer®?
The Propensity to Refer® data model is a customer segmentation tool which predicts each customer’s propensity to refer at the point of purchase.
How does it work?
Each customer will be segmented into one of two main groups; those with a High Propensity to Refer and those with a Low Propensity to Refer.
These groups will then be presented different experiences optimised for conversion, The High Propensity to Refer group will be shown a referral offer while the Low Propensity to Refer group will be shown an alternative action based on their business goal for the experiment.
Example drivers used to predict the customers' behaviour
|Impact on prediction
|Number of past orders
|Marketing opt-in status
|Revenue from most recent order
|Number of past shares
How do we calculate additional value of the Propensity to Refer®?
In order to calculate the additional value of Propensity to Refer® we compare the performance of the Low Propensity to Refer group (who are shown an alternative action to referral) against the Control group.
How are your customers being segmented?
Here is an example aggregated view of the proportions of propensity groups being calculated within a customer base. (Proportions may differ slightly at the experiment level).