Effectiveness of a Marketing Campaign to Sell Long Term Bank Deposits

Group 1Aditya Bahl, Prabhu Bijja, Pratibha Kumar, Sohini Sarkar

Background

● Term deposits held at a financial institution for fixed term.

● Higher interest compared to traditional savings accounts.

● Maturities range from a month to a few years.

● Safe investment.

● Appealing to conservative, low-risk investors.

● Allows banks to invest in higher gain financial products.

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Problem Statement

Which customers should be targeted for long-term bank deposits?

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Project Outline•Gather and explore data

•Data preprocessing

•Model building

•Model comparison

•Conclusion

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Gather and Explore Data• Number of instances – 41,188

• Number of attributes – 20o Attributes related to bank client datao Attributes related with the last contact of the current

campaigno Attributes related to social and economic contexto Other attributes related to previous campaigns

• Target variable (Y) – Has the client subscribed a term deposit?

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Data Exploration

Categoric data converted to numeric6

Data Preprocessing• Target leakage possible with Duration: Excluded

• Highly skewed #Contacts: Excluded

• Important variables from histograms• Education, job, personal loan, marital status, default,

market characteristics

• Missing values reported as “unknown” or “999”• > 5% - Excluded • < 5% - Imputed by Predictive Mean Matching

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Data Preprocessing• Class imbalance problem• SMOTE used to generate balanced data

Original Dataset Balanced Dataset8

Model Building• Models assessed

– Decision tree – Random Forest– Naïve Bayes

– Adaptive Boosting

– Clustering• Nominal and numeric data – Kmeans not a good option• Simple Matching Coefficient prohibitive for large dataset

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Train with balanced dataTest with original data

Train and Test with original data

Model Comparisons

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Modeling Method

Accuracy Overall Error ROC

Decision Tree 0.87 0.13 0.73

Random Forest 0.88 0.12 0.78

Naïve Bayes 0.72 0.28 0.76

Adaptive Boosting

0.90 0.1 0.8

Selected Model - Adaptive Boosting

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Important Variables

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*** Campaign specific

**** Customer specific

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*****

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*******

***********

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* Market specific

** Bank specific

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Customer Specific Characteristics

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Campaign Specific Characteristics

Distribution by Campaign

# of times contacts performed for the client during this campaign

Distribution by Previous (contacts) Distribution by Month

# of times contacts performed for the client before this campaign

Conclusion• Customers to be Targeted:

• Age: 30-50• Education: University, High School, Professional Courses• Job: Admin, Blue-collar, technician

• Campaign Targets:• Customers who were not contacted before• Plan Campaigns from May through Aug.• Success rate for customer enrollment is more for 1-5 contacts

during present campaign.

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Questions?

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