Predictive and Prescriptive Analytics Peek into the Future

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Keenan, the foundation of an effective campaign is understanding the drivers of past positive business results and re-creating those conditions to ensure positive results in the future. "This boils down to action and reaction. You get analytics back based on previous behaviors, and with the help of prescriptive tools, translate those actions into subsequent actions—reactions," he explains. Though there are predictive algorithms in action here, predictive analytics "with a capital P" shouldn't come into play until later, Keenan says.

Prescriptive and predictive tools are "loosely coupled," he explains, because the output of an effective execution of prescriptive analytics should be input into predictive analytics tools. Where prescriptive analytics offers insight that can help marketers determine the right course of campaign action, predictive analytics offers insight that can answer questions about the greater business implications of those actions. "With prescriptive analytics, we're talking about pinpointing the right action to increase conversion rate, or decrease the time from lead to close. With predictive tools, we're looking at what these wins mean moving forward. There is a loose coupling because it starts with prescriptive insight, which feeds into predictive insight," he says.

The Farm Credit Services of America, for example, uses Aptean's Pivotal CRM tool to inform its upcoming customer campaigns. The company, which provides credit and other financial services to farmers and ranchers across Iowa, Nebraska, South Dakota, and Wyoming, employs Pivotal capabilities to aggregate the results of both successful and unsuccessful customer engagements. Because it competes with a number of national credit unions and banks, the Farm Credit Services of America has to consistently provide competitive financing options to potential customers, updating rates and offers to keep up with changes in the market and in competitors' offers. With prescriptive analytics from Aptean's Pivotal CRM solution, the Farm Credit Services of America can automate the process of generating the right offers to the right customers quickly. But all of that is "tactical execution," Keenan says. The next phase is strategic, and that's where predictive analytics take center stage.

"Predictive analytics are designed to answer the macro questions of running a business, and that's why they shouldn't necessarily influence any short-term campaign moves," he explains. For the Farm Credit Services of America, this means thinking about its campaign strategy as a whole and evaluating how it stacks up against ongoing industry trends or other long-lasting processes, such as an economic recession or boom, that have an effect on the way customers may interact with the company throughout the relationship.

Financial institutions such as Farm Credit Services have more complex relationships with clients than, for example, a retailer, because they often involve long-term repayment plans and regular, predictable interactions. Analytics solutions deployed by such organizations must be particularly "forward-thinking," Keenan says, and while the handoff between prescriptive and predictive tools may happen quickly in a retail setting, there is a need for more separation in different industries.

"For a company like Farm Credit Services, it's not about selling a product and then selling an accessory for the product a week later. We're 

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