Predictive Analytics World Had the Target Story First

The New York Times Magazine article "How Companies Learn Your Secrets" by Charles Duhigg with the key descriptions of Target, pregnancy, predictive analytics (blogged on here and here) certainly generated a lot of buzz; if you are unable to see the NYTimes Magazine article, the Forbes summary is a good summary. However, few know that Eric Siegel booked Andy Pole for the October 2010 Predictive Analytics World conference as a keynote speaker. The full video of that talk is here.

In this talk, Mr. Pole discussed how Target was using Predictive Analytics including descriptions of using potential value models, coupon models, and...yes...predicting when a woman is due (if you aren't the patient type, it is at about 34:30 in the video). These models were very profitable at Target, adding an additional 30% to the number of woman suspected or known to be pregnant over those already known to be (via self-disclosure or baby registries). The fact that this went on for over a year after the Predictive Analytics World talk and before the fallout tells me that it didn't cause significant problems for Target prior to the attention brought to the subject related to the NYTimes article.

After watching the talk, what struck me most was that Target was applying a true "360 deg" customer view by linking guests through store visits, web, email, and mobile interactions. In addition, close attention was paid to linking the interactions so that coupons made sense: they didn't print coupons to those who had just purchased items they score high for couponing, and they identify which mediums don't generate responses and stop using those channels.

I suspect what Target is doing is no different than most retailers, but this talk was an interesting glimpse into how much they value the different channels and try to find ways to provide customers with what they are most interested in, and suppress what they are not interested in.