A Probabilistic Approach to Maximize Cross-Selling Revenues of Financial Products
AbstractCustomer oriented approach and developing analysis for customers have become more important as the competition became a global issue, especially after technological advancements. Companies aim to sell more products to new customers and also to their current customers while keeping them in the portfolio and making sure that they are happy. Cross-selling of products and services to their customers is almost as important as gaining new customers. In this paper, a probabilistic and integrated method of cross-selling financial products is proposed. The proposed method first segments the customers based on the selected criteria and then calculates the probability of buying each product using product and customer relationship matrixes. Then, the expected yield for each group of customers and offer is calculated, and the best cross-selling strategy is determined. The proposed methodology is applied to a Turkish bank that aims to sell financial products through cross-selling. The results show that the methodology successfully determines the product order to be used in cross-selling in an effort to increase the success rate in the selling process and expected revenue.
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