Understanding the Incremental Impact of a Promotional Offer
The CompanyA leading North American wireless provider
The ChallengeThe client had offered a $150 discount to new customers signing a post-paid contract. After trying this promotion in six test markets, management was having a difficult time understanding whether the promotion was drawing enough incremental customers to offset the discount.
The SolutionThe client used APT’s Test & Learn™ software to measure the true incremental profit impact of the promotion. APT showed that the promotion led to a significant increase in activations overall. APT then drilled down to the customer level and determined that almost all of the increase was coming from sub-prime customers. For prime customers, there were barely any incremental activations, indicating that the client was simply giving away money to customers who would have signed a contract anyway. APT also identified that the program was most successful in younger areas and in stores with a specific operational structure.
APT used these drivers of performance to build a predictive model to target a rollout of the promotion to markets that were scientifically predicted to respond positively.