Updated: February 6, 2017
In 2015, Joe McKeehen became the World Series of Poker champion after winning the Las Vegas Main Event. "He had no bad luck," said Norman Chad, ESPN's poker commentator as quoted on Philly.com. "Everything was in rhythm."
Everyone loves a good tale of beating the odds. But it shouldn't come as a surprise that McKeehen began playing the game in middle school, making it his full-time priority as a teenager when he realized he could earn more per hour with the game than at his grocery-store job.
In poker, your luck is what you make it. The same goes for your dealership's marketing strategy -- and both also have a lot to do with knowing as much as possible about the people you're trying to reach. Predictive modeling is one of the most important tools available for learning more about your best customers, and finding more just like them.
Predictive modeling: the basics
Predictive modeling refers to creating statistical models that provide insights into future behavior, and these models are consistently being refined over time to deliver better accuracy and results. Therefore, effective predictive modeling requires access to multiple, consistently refreshed data sources.
3 Birds uses a number of sources to build our models, including your CRM and DMS, demographic data, and behavioral data from your dealership’s monthly marketing communications. As our system learns more about how your customers are engaging with your content, it can make smarter predictions about their purchasing intent—setting us apart from other so-called “predictive” models that only refresh when your DMS data updates.
The value of predictive modeling lies in its ability to go beyond the limitations of single data sources (such as demographic data) and pinpoint actionable customer intent. Matching these models with your customer database reveals future marketing opportunities driven by data, not by instinct.
Predictive modeling is an ongoing process that grows more powerful over time. Your models' conversion rates may reinforce what you think you know about your customers, or reveal surprising gaps between your assumptions and your actual customers' behavior.
Why predictive modeling is key for your dealership
There are several reasons why predictive modeling can be particularly revolutionary for your dealership's marketing strategy. First, dealers have faced considerable challenges in the past when it comes to getting the most out of their data. Data-siloed vendors and inaccurate reporting diminish your ability to easily extract the value in your database, leaving your messaging generic, heavy-handed, and often tone-deaf.
In addition, while some so-called "predictive" dealer solutions have been offered previously, most of these models are based solely on historical data and sources that are refreshed infrequently. Since over 60 percent of customers don't follow manufacturer recommendations according to Dealer Marketing Magazine, this approach can end up alienating over half of your database.
Finally, predictive modeling helps maximize the ROI of your marketing investment by directing your marketing dollars toward your highest-value customers -- the customers who look forward to your communications each month, who think of your dealership first when it's time to service, and who come to you for the best deal on their trade-in. Instead of expending money on defectors and low-value leads, you'll be able to focus on retaining customers like these and graduating middle-of-the-road leads into more valuable segments.
3 Birds: the key to a winning strategy
Predictive sales and service modeling from 3 Birds offers a better way for dealers to take advantage of their customer data. Our predictive models draw on third-party data sources (including demographic data and market data), your own CRM and DMS data, and behavioral data that is unique to 3 Birds' content-and-data-driven marketing model to determine consumer intent and power your future marketing.
Explore the powerful 3 Birds marketing solution featuring predictive modeling by scheduling a 15-minute demo today. Luck is all well and good -- but it helps when you're playing with a winning hand.