Inspire 2014 – AAA: Target Marketing with Predictive and Geo-spatial Analytics
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Transcript of Inspire 2014 – AAA: Target Marketing with Predictive and Geo-spatial Analytics
#inspire14 AAA CONFIDENTIAL
Target Marketing with Predictive
and Geo-spatial Analytics
Daniel Mathieux
Director, Marketing Insights & E-Business
American Automobile Association
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Agenda AAA and Geo Spatial Analysis
Types of Analysis
Retail Trade Area Enhancement
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Types of Requests for Geo Spatial Analysis
AAA and Geo Spatial Analysis
• Investigation of specific target locations for Club stores
• Sites for AAA Car Care, Travel or Insurance Center
• Membership Sales and/or Opportunity
• Business Line Sales and/or Opportunity
• Opportunities for AAA Partner Product/Service Usage
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Typical Items included in a AAA Geo Spatial Analysis
AAA and Geo Spatial Analysis
1. Convenience and ease of access
2. Proximity to member population
3. Member DriveTime and Distance
4. Population by time of day
5. Membership penetration and growth opportunity
6. Business line usage and opportunity for growth
7. The Executive Summary addresses findings pertinent to the project
purpose
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1. Convenience and Ease of Access
Geo Spatial Analysis of Multiple Locations
• Define and establish the area of
study for an accurate visualization
• Locations may be existing or
potential
• Display locations with road
structures and natural boundaries
to see the impact on access
• Observe how close stores are to
one another
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2. Proximity to Member Population
Geo Spatial Analysis of Multiple Locations
• Member data has been
geocoded
• A pinpoint map is used to
picture where members live in
relation to the stores
• Members are highly
concentrated around Store 1.
• Members are less concentrated
around Store 2.
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3. Member DriveTime and Distance
Geo Spatial Analysis of Multiple Locations
• Grid analysis shows a high
concentration of members near
Store 1.
• Member concentration is less
around Store 2.
• Most members are within a 10
miles or a 20-minute DriveTime
(purple squiggly line).
• Store 2 is within the 20-minute
DriveTime from Store 1. Member HH -Low (Below 40.5)
Member HH -Below Average (40.5 to 135)
Member HH -Average (135 to 440)
Member HH -Above Average (440 to 1450)
Member HH -High (Above 1450)
Territory Boundary
5 Mile Radius
15 Mile Radius
20 Minute DriveTime
Area store
Study store
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4. Population by Time of Day
Geo Spatial Analysis of Multiple Locations
• Census data (Employee count) is
added to review the Daytime
population.
• The grid map shows the area
around Store 2 is more densely
populated during the day.
• The shift in population, the
Daytime (Employee) population,
exhibits the increased opportunity
for store use. Employees -Low (Below 2)
Employees -Below Average (2 to 15.25)
Employees -Average (15.25 to 115)
Employees -Above Average (115 to 870)
Employees -High (Above 870)
5 Mile Radius
15 Mile Radius
20 Minute DriveTime
Area store
Study store
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5. & 6. Membership and Business Line Needs
Single Purpose Centers, Sales & Opportunity Analysis
• Census and AAA data are used to forecast sales and opportunity.
• We define current AAA customers for each business line.
• Income, household count and other Census data are used to profile
customers and potential customers in the surrounding area.
• Data is imported from AAA sources, such as travel, ERS, auto buying,
insurance, vehicle repairs.
• The opportunity for sales or usage among members and non-members
is calculated.
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AOS Branch
AAA
Member
HH
AAA
Member
Population
Experian
Consumer
HH
Experian
Consumer
Pop
Employee
(Daytime)
2013
Census
HH
2013
Census
Pop
Study Branch 1 36,050 66,624 114,129 195,152 212,814 166,841 411,446
Study Branch 2 35,185 64,898 115,338 197,605 214,097 167,454 410,965
Study Branch 3 57,420 129,886 205,752 350,386 331,357 243,425 614,358
Geo Spatial Analysis of Multiple Locations
7. Executive Summary and Reporting
• After reviewing the Study area’s 15-mile radius, the results are
totaled and provided in an Executive Summary.
• The Club has the largest opportunity for membership growth and
Daytime customers in Study Branch 3.
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• A pinpoint map gives a close look
at the road layers, natural
boundaries (water, park)
or club territory boundary.
• The grid map visualizes
the population groups.
• The display method
depends on the data and
features to be shown.
Displaying The Details
Geo Spatial Analysis of AAA Locations
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• Ohio is served by multiple
AAA clubs.
• The club headquartered in
central Ohio has 31 stores.
• The store service areas
overlap at 15-mile radius,
20-minute Drive Time.
• Overlap occurs even at 5
miles and crosses club
territory lines.
Enhancing Store Analysis with Retail Trade Area
15 Mile Radius
Club Territory
Ohio State Boundary
store Office
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Project Objectives
Retail Trade Area Project
• Define the realistic market area for each store.
• Provide the ability to measure store performance, profitability,
products and services used, penetration of members served.
• Identify individuals and households by trade area for marketing and
reporting.
• Identify members underserved by the club network of 31 stores.
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Project Requirements
Retail Trade Area Project
• Use the industry method that best meets club needs.
• Associate each member with only one Trade Area.
• Maintain member-to-trade area relationship automatically and
promptly.
• Identify trade area population segments and delineate the customer
mix by segment.
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Industry Methods
Retail Trade Area Project
• Deterministic – The boundary is the time or distance most customers
travel to the store used. Trade areas are likely to overlap.
• Proximal - Assign area closest to a store. This may exclude some
customers.
• Probabilistic – Travel distance or time is combined in a model with
store attractiveness, availability of competitors, rural or urban
setting, population density, traffic volume and patterns.
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AAA Methodology
Retail Trade Area Project
• The proximal method is the basis for AAA Retail Trade Areas.
• Member address data was used to identify the closest AAA store.
• Each household and member is assigned to the closest (Home) store.
• Transaction data was used to identify members with store activity.
• Trade area boundary is the average distance traveled by members to
their Home Store, the closest store, plus two standard deviations.
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Customer Mix by Member Segment
75.2
23.5 1.3
Home
Foreign
Out of Territory
• Home = Home Store members
• Foreign = Club Members from another Home Store, commuting or traveling
• Out-of-Territory = Members from another club
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A Trade Area tool is developed in the club marketing database
Retail Trade Area Project
• The Retail Trade Area boundary for each store is recalculated automatically as
more members use their Home Store.
• The 2-year look-back for transactions is automated and reflected in the Retail
Trade Area tool.
• Changes in the data are reflected immediately, i.e. new members, members
with a change of address, new non-members in the trade area are automatically
associated with the corresponding store.
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Trade Areas Displayed in a PinPoint Map
• A pinpoint map shows
member households in
each store trade area.
• Trade areas with similar
household counts are
the same color.
• Size differences reflect
the difference in
average customer
driving distance.
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Map Shows Members Out-of-Network
• Member households
outside the store
network are shown in
bright pink.
• For these members,
travel to their Home
Store exceeds the
distance current
customers travel.
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New Capabilities Useful for Store Management
Benefits for Club Operations
• Measure store performance and profitability
• Set realistic goals by store
• Monitor the trade area population size and demographics for
changes indicating a need to relocate or add a store
• Improve access and options for members out of the store network
• Predict sales and activity for new or relocated stores
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Abilities to enhance service and communication
Benefits for Marketing
• Identify business line opportunities by store
• Customize service delivery to trade area
• Develop marketing tactics to meet
the store business objectives
• Use consumer and member data to
personalize communication relevant
to the market segments.
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MemberCustomers
MemberNoStoreTrans
PastMembers
NonMembers
Population Segments
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Summary and Conclusions
• Visualization tools show detail that is especially useful for site
evaluation.
• AAA uses geo spatial analysis to evaluate and select sites for full
and specialty service based on physical and projected opportunity
analysis.
• Retail Trade Area delivers enhanced capabilities for store evaluation
and customized marketing.
Daniel Mathieux [email protected] 407-444-8528
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THANK YOU!