Mining customer value: from association rules to direct marketing

Direct marketing refers to a process of identifying and mailing to potential customers. We push the customer value as the first class information. Our approach is to estimate directly the profit generated on a customer without estimating the conditional class probability. This methodology opens up new possibilities for profit estimation. We use association rules to summarize customer groups and to build a model for profit prediction. The advantage of the association rule approach is its scalability of finding correlated features that may never be found in local search. The evaluation on the well known, large and challenging KDD-CUP-98 task shows a breakthrough result.