The Mining Data Mart - Data Mining Techniques in CRM: Inside Customer Segmentation - page 141

specific needs, available resources, and required detail of information, an aggre-
gation at a lower time period (weekly, daily, etc.) could be implemented for all
or for a subset of key attributes. For example, a daily tracking of credit and debit
transactions could be useful for both reporting and triggering campaigns.
Segment and Group Membership
A bank typically categorizes its customers according to their characteristics into
broad, distinct groups such as retail, corporate, private banking, and so on.
Customers are also assigned to core segments (affluent, mass, etc.), grouped
according to their status (active, dormant, etc.), and flagged according to other
important attributes such as having a salary account at the bank or belonging to
the bank's staff. These customer categorizations enclose important information for
marketing and analytical purposes.
The first monthly table proposed (''M_Segments''), Table 4.3, incorporates
information about the bank's main segmentation schemes and groupings. The
contained data are at a customer level and indicate the group memberships of each
customer, at the end of each month.
Product Ownership and Utilization
Any bank should monitor the product mix and product utilization of its customers.
This information is tracked by the next proposed table (''M_Products''), Table 4.4,
which includes monthly aggregated data on product ownership and balances.
It is a table at the customer and product account level that only refers to open
accounts, even if these accounts have zero balance. It summarizes product balances
for each month, including both outstanding (end of month) and (daily) average
balances. By mining the historical data, analysts can reveal any shifts or declines
in the customer's relationship with the bank and understand the evolution of each
customer's product portfolio.
A lookup table, to be presented below, can be used to group product codes
and to summarize customers with respect to a higher hierarchy level of product
categorization (deposits, investments, loans, etc.). This table also includes other
product-specific information such as the credit limit and the minimum payment
amount for credit card accounts or the approved amount in the case of loans.
Bank Transactions
Customers differ in terms of the volume and frequency of the transactions they
make. They also prefer different channels for their transactions and make different