A Simple example of the value of analysis

Businesses often struggle to get anywhere below the top level of reporting for any area of the business whether it's Direct Mail, Press, cancellation rates etc.,

In the example shown above, if just overall level data was available a company may know that it costs £53.80 to gain a new customer and that new customers on average pay back £42.25.


Taken at that level it can be thought that a company's acquisition strategy is not working and is losing money.


This is a perfect example of 'Binary Thinking' - Direct Mail is either profitable or it's not.  Press advertising loses us money or pays its way.


This hides the inevitable fact that some groups of customers cost far more than average to acquire and some pay back less than others.