Movie Magic Implementing Strategy with Analytics
APPROACHMovieMagic offerings need to be analyzed with respect to usage patterns, customer base and behavior, sales & product portfolio and come up with strategies backed by customer understanding & personalization.
DATA ARCHITECTURE MODEL DEVELOPMENT DERIVING STRATEGIES
- Databases are created using various sources:
− Customer
− Media
− Usage
−Common linkages are created using Primary keys IDs
−New data definitions are derived.eg.current inventory, turn-around-time etc.
Classification is done based on Volume vs. Value concept.
−Technique used:
− Cluster analysis
− RFM Technique
−Clusters/Groups created based on independent metrics available for each of the categories.
−Prediction models developed for each branch of fishbone.
Defining customers via metrics in terms of clusters created for each branch.
–Personalization exercise for each cluster.
–Strategy derived for each segment:
– Financial
– Marketing
– Sales
– Supply Chain.
DATA ARCHITECTURE
Subscription ID Description
1 Online Yearly
2 Offline Yearly
3 Online Monthly
4 Offline Monthly
Customer ID
Name Address Email Joined Date
*Customer Type
Subscription ID
Subscription Date
Customer ID
Media ID
Date of Rent
Period Quantity Price
Media ID
Media Name
Type Category ID
Inventory (Q)
Date Time Stamp
Rented Quantity
[Movie/Game Name]
Movie/Game
Cat. ID Descr. Class
1 Genre Movie
2 Starcast Movie
3 Released Movie
4 Language Movie
5 PC Game
6 PS Game
7 Genre Game
Customer Database
Rent Logbook DB
Sub
scri
ptio
n D
B
Media Database
Med
ia C
ateg
ory
DB
DETAILED PROCESSIllustrated below is the detailed process of Clustering and RFM
RFM stands for Recency, Frequency & Monetary Analysis
Recency: When did the customer make their last purchase?Frequency: How often does the customer make a purchase?Monetary: How much money does the customer spend?
The following step by step process will be followed for the Modeling:DATA: It has the fields : (i) ID, (ii) Area, (iii) Country, (iv) Recency (Rcen), (v) Frequency (Freq), (vi)Monetary (Money)Only the 4 attributes, area, recency, frequency, monetary, and one class (output),loyalty, are used to build the decision table.
STEP1: Cluster customer value by K-means algorithm. This step the scaling of R–F–M attributes and yield quantitative value of RFM attributes as input attributes, then cluster customer value by using K-means algorithm. The detail process of this step is expressed into two sub-steps as follows: (..contd)
STEP1a: Defining the scaling of R–F–M attributes.
This sub-step process is mainly divided into five parts introduced in the following:
(1) The R–F–M attributes are equal weight (i.e. 1:1:1).
(2) We define the scaling of three R–F–M attributes, which are 5, 4, 3, 2 and 1.
(3) Sort the data of three R–F–M attributes by descendant order.
(4) Partition the real data of R–F–M attributes respectively into 5 scaling in MovieMagic dataset
(5) Yield quantitative value of R–F–M attributes based on input attributes for each customer
Sample Table:
STEP1b:
Cluster customer value by K-means algorithm.
According to quantitative value of R–F–M attributes for each customer, partition data
into n clusters using K-means algorithm for clustering customer value. (contd..)
METHODOLOGIES:CLUSTERING/PREDICT
RentRent SubscriptionSubscription Non-SubscribersNon-SubscribersSubscriptionSubscription
One Time Repeaters Yearly/Monthly Yearly/Monthly One Time Repeaters
For each of the Fishbone branch>>Subset of data obtained>Clustering/RFM Technique Used>Model developed.
Cluster Function of:
-DatetimeStamp-Geography
-Media Category-Media Type
Cluster Function Of:
-DatetimeStamp-No. of Times
Rented-Geography
-Media Category-Media Type
Cluster Function of:-DatetimeStamp
-Geography-Media Category
-Media Type-Subscription type
-No. of times subscribed
-No. of times discontinued
Cluster Function of:-DatetimeStamp
-Geography-Media Category
-Media Type-Subscription type
-No. of times subscribed
-No. of times Discontinued
-Browsing history
Cluster Function of:
-DatetimeStamp-Geography
-Media CategoryMedia Type
-Browsing history
Cluster Function of:
-DatetimeStamp-Geography
-Media Category-Media Type-No. of times
bought-Browsing history
IMPLEMENTATION
Sales Strategy•USAGE PATTERN: Within X days of release, Y% of extra streaming over base and thereafter Z% of extra rent over base value after X days.
•COMBO PACKS: Creating **combos of DVDs to push sales of Slow Mover DVDs
Financial Strategy•DISCOUNTING: Discounting to clusters of users based on profit generation, less penetration, opportunity index. Like Hike Prices when demand more in streamline for a period,pattern of usage.
•SUPPLIER NEGOTIATION: Based on usage pattern, demand forecasting, days of payable outstanding can be negotiated with the suppliers
Marketing Strategy•GEO SPECIFIC ADVERTISING:
More advertising in less penetrating areas with respect to the usage index, competitive scenarios.
•TARGET MARKETING:
based on usage pattern & specific demands, Customer Lifetime Value.
Supply Chain Strategy•STOCKOUT/BACKLOG: predict inventory to avoid stockouts, Calculate Adjusted Turn Around Time based on Consumption Pattern for each branch of Fishbone.•RED FLAGS: Flagging Users which are probable unsubscriber/ discontinuation of usage based on patterns of subscription packages they used.•DISTRIBUTION NETWORK: local network at more demanding areas.
**DVD Types:1 movie/game pack, N in 1 pack ,Combo Packs , Star Packs, Vintage packs etc.
Personalization: Creating portfolio of users at Individual level and implementing above strategies.