XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon Research in the age of Pragmatism Reinterpret Redesign Reinvent XXII Annual Seminar
Transcript
Slide 1
XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon Research
in the age of Pragmatism Reinterpret Redesign Reinvent XXII Annual
Seminar
Slide 2
XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon Making
Consumer Segmentation a Real Time Process Open New Doors XXII
Annual Seminar 2 Anjan Kumar Ghosh, Senior Vice President Bhavesh
Mansinghani, Research Director Hansa Research
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XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon
Background Our client is a leading player in the financial services
space offering consumer finance and financing capital requirements
of SMEs Client product portfolio: Consumer durable loan Personal
Loan Small Business Loan Loan against property Current business
environment suggests the following facts and hypotheses: Higher the
affluence of the customers, higher is the ticket size for their
loan Servicing cost as a proportion of ticket size is lower for the
high ticket loans Although CIBIL and internal audits ensure that
creditworthiness of customers is evaluated properly before loan
disbursal, the system currently does not ensure appropriate
targeting of the loan to the consumer segment So the need was to
set up a system that facilitated effective targeting of offerings
in the market
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XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon Key
client questions and thought for research Key questions Are we
reaching the affluent audience? At the time of loan application, is
it possible to assess the affluence level of an individual? Thought
for Research Identify indicators to measure the affluence level and
create affluence segments of current customers Basis the affluence
segment of the current customer base, identify cross-selling and
up-selling opportunities Identify variables that can be included in
the loan application form, to assess the affluence segment for new
acquisitions; thus aid in better targeting
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Are we reaching the affluent audience? Decoding Affluence
Applying the HPI Construct on the existing customer base Affluence
profile across business verticals Implications for the
marketer
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XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon Decoding
affluence Handicapped in situations where the target group is
intrinsically homogenous Conventional SEC not strongly correlated
with affluence Possible number of segments limited to currently
available options MHI Patently unstable on account of hesitance to
disclose the correct MHI leading to over claims or under claims
Problem maybe accentuated amongst SMEs Scientific method to
segregate and target the consumers basis a more direct measure of
affluence
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XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon
Household Premiumness Index (HPI) An established system of
classifying consumers, based on indicators from the Indian
Readership Survey (IRS) It covers ownership of durables,
consumption of FMCG categories, and demographic measures. The HPI
philosophy : If a home is premium, it necessarily gets reflected in
product consumption or ownership. Defining premiumness : Something
that is desired by most but affordable for few. Hence, we define
premiumness as inverse of penetration. Non-judgmental approach
Consistent across all types of products/services Scores obtained
for all indicators are aggregated for a household and indexed to a
maximum of 1000. Provides the opportunity to define as many
segments as desired by the marketer
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XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon Task
involves profiling client customers through variables that
determine affluence and go into computing HPI Census being
unrealistic, estimation needs to be done through a sample survey of
clients customers Sample selection needs to ensure representation
of customers for its various product verticals Within a vertical,
the sample of current customers ought to match the universe profile
on key variables, in order to have an accurate measure of affluence
Applying the HPI Construct on the existing customer base
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XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon Ensuring
representation of the sample The primary research to ascertain HPI
was conducted amongst a representative sample that was drawn
randomly from the current customer database, after stratifying them
on basis of relevant parameters for each business vertical. The
sampling variables used are listed below Consumer Durables (CD)
Personal Loans (PL) Small Business Loans (SBL) Loan Against
Property (LAP) Branch No. of yrs since enrolled Status : Live /
ExpiredSalaried / Self employedSource of acquisitionEMI ( 1.05L)
Credit program code Loan Amount (>1lac, 2200,
XXII nd Annual MRSI Seminar, 17-18 December 2012, Gurgaon
Application form We want to know you better Please tick the
relevant boxes. In case of multiple items, give details of the
latest item bought. Preferred Language Net monthly income Rs.75000
Which of the following do you own? Microwave Cooking range Electric
smoke chimney Printer Laptop Vacuum cleaner Please tell us about
your car New car Second hand car Do not own |Was the car bought on
a loan? Yes No Please tell us the price of the car < 5Lacs
5-10Lacs >10Lacs|Month & Yr of purchase, Please tell us
about your fridge 280L or less Greater than 280L Do not own Please
tell us about your TV Normal TV Normal -Flat TV LCD/LED Plasma Size
of the TV 21inch or less Between 21-30 inch 30inch or more Please
tell us about your washing machine Semi Automatic Fully Automatic
Do not own Type of internet access at home? Broadband Dial-up
Wireless data card Do not own Please indicate your level of
education SSC/HSC Diploma Graduate Post Graduate What type of
credit card do you have? Platinum/Titanium Gold Silver
Others_________ Do not own What type of insurance do you have? Life
Car Medical Property Plant & Machinery Other _____________ Do
not own Have you traveled abroad in the last year? Yes No
DECLARATION
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XXII nd Annual MRSI Seminar, 17-18 December 2012, Gurgaon What
did we achieve? We could evolve a set of classification variables
which are good enough to identify heterogeneity in a largely
homogenous audience Apply an algorithm to categorize customers into
a particular segment on a real time basis, at the time of loan
application HPI coupled with LCM opens an opportunity for a REAL
TIME SEGMENTATION PROCESS
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Thank You
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Appendix
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XXII Annual MRSI Seminar, 17-18 December 2012, Gurgaon
Segmentation Variables VARIABLES Cooking Range Dish washing Machine
Electrical Smoke Chimney Electric Geyser Electric Kettle Laptop
Microwa ve oven PC / Desktop Printer Vacuum Cleaner TV Air conditio
ners Internet access Transpo rtation