1. © 2014 Fair Isaac Corporation. Confidential. This presentation is provided for the recipient only and cannot be reproduced or shared without Fair Isaac Corporation’s express consent. Marketing Mix Mayhem How to Optimize Marketing Decisions and Customer Personalization in a Churning Marketing Landscape Horia Tipi Director, Product Management FICO

2. © 2014 Fair Isaac Corporation. Confidential. What offers would drive loyalty and maintain profit margins? How do we expand without taking on too much risk? Can we deal with complexity and make decisions in real time? Are we really maximizing performance? 2

3. © 2014 Fair Isaac Corporation. Confidential. Agile and precise marketing done in real-time to deliver the best offers to your customers. 3

4. © 2014 Fair Isaac Corporation. Confidential. Evolution of Precision Marketing 4 19952005Today One size fits all Another customer Micro-segments and true 1:1 marketing Marketing segmentation

5. © 2014 Fair Isaac Corporation. Confidential. Digital Explosion of Marketing Channels Social Print In- person 5

6. © 2014 Fair Isaac Corporation. Confidential. Delivering Individual Message to Millions of Customers The Challenge 6

7. © 2014 Fair Isaac Corporation. Confidential. And It Doesn’t End There 7 Hyper-competitive markets Need to retain the best customers Diminishing profitability Changing regulations Economic uncertainties Everything changes all the time

8. © 2014 Fair Isaac Corporation. Confidential. Handling Variants and Constraints Products Discounts Rewards Offers ► Deliver offer to the customer at the moment they are most willing to buy ► Multiple-touch Timing ► In-store ► Internet ► Email ► Mobile ► Social media ► Telephone ► Mail Channels ► Acquisitions ► Retention ► Add-on services ► Cross-sell ► Up-sell Objectives Regulatory Business Execution Budget Constraints 8

9. © 2014 Fair Isaac Corporation. Confidential. The Imperative: Harness Big Data 9

10. © 2014 Fair Isaac Corporation. Confidential. What Should You Do? 10 Understand customer preferences ► Dissect historical and real-time customer data to understand individual preferences and recommend more relevant offers Balance real-word constraints ► Find best treatment for each customer given real-world constraints (mailing volume, store locations, budgets) Execute precision marketing ► Execute portfolio-level business strategies with precision at the individual customer level

11. © 2014 Fair Isaac Corporation. Confidential. Effective Large-Scale Campaigns Require Optimization Along Many Dimensions Millions of customers Thousands of possible actions Varying marketing objectives Multiple channels and brands Hundreds of inputs Conflicting business constraints 11

12. © 2014 Fair Isaac Corporation. Confidential. ► Predefined, inflexible templates ► Works at first but does not adapt to change ► Forces you to use predefined data formats and systems ► Expensive with diminishing benefits ► New features needed?—wait for roadmap to possibly catch up ► Good real time (reactive) performance but little analytic smarts What’s in the Market Already 12

13. © 2014 Fair Isaac Corporation. Confidential. ► Criteria for your marketing optimization: ► How to best spend the campaign budget? ► How to target customer segments? ► How to manage customer messaging ► Is there a case for increased spend? ► How to best trim spend if challenged? ► How to allocate spend across campaigns and time? ► What do I do about new channels popping up all the time? ► How can I reduce unsubscribes? ► How can I manage continuous change? Here’s What You Want Your Optimization Solution to Do: 13

14. © 2014 Fair Isaac Corporation. Confidential. FICO ® Offer Optimizer 14 A powerful optimization tool built for marketers wanting to increase customer centricity, profitability, and competitive advantage. Built for marketers Advanced mathematical modeling Better decisions Optimized solver

15. © 2014 Fair Isaac Corporation. Confidential. 1.To accurately capture your true campaign optimization challenges 2.To find the quantifiable optimal solution 3.To automatically learn to further improve campaign outcomes 4.To adapt as your needs evolve Why Would I Use FICO ® Offer Optimizer? 15

16. © 2014 Fair Isaac Corporation. Confidential. Do You Have 3 or More of These Problems? Targeting large numbers of customers (500K or more) On the path toward customer centricity Want to increase customer base Want to provide a better customer experience You are wasting marketing dollars but can’t tell where Your campaign requirements are too complex for the average software 16

17. © 2014 Fair Isaac Corporation. Confidential. Bank Increases Marketing Campaign Effectiveness Offer Optimizer Put to Work 17 Benefits Increase cross-sell and up-sell Increase ROI Increase customer loyalty Operational Results Highly relevant and timely offers Better use of marketing funds Demonstrated true customer centricity at individual level $ Customer Leading retail bank Challenge Deliver personalized offers to 15 million customers across multiple portfolios through diverse channels Solution FICO ® Offer Optimizer

18. © 2014 Fair Isaac Corporation. Confidential. Give us your hardest problem ► Share your existing pain points. Contact us and we’ll take a sample of your data and stand up our solution to show you how it works and how you can benefit. What’s Next? © 2014 Fair Isaac Corporation. Confidential.18

19. © 2014 Fair Isaac Corporation. Confidential. This presentation is provided for the recipient only and cannot be reproduced or shared without Fair Isaac Corporation’s express consent. Thank You! Horia Tipi horiatipi@fico.com 646 267 2306

20. © 2014 Fair Isaac Corporation. Confidential. Learn More at FICO World Related Sessions ► Making the Best Offer ► How Optimization Helps You Turn Questionable Data… Products in Solution Center ► FICO ® Offer Optimizer, FICO ® Optimization Modeler, FICO ® Xpress Optimization Suite Experts at FICO World ► Matt Stanley (mattstanley@fico.com) ► Horia Tipi (horiatipi@fico.com) White Papers Online ► Marketing Mythbusting—Six Maxims Get Put to the Test (http://www.fico.com/en/request_asset/?asset_id=9159) Blogs ► www.fico.com/blog 20

21. © 2014 Fair Isaac Corporation. Confidential. Please rate this session online! Horia Tipi horiatipi@fico.com 646 267 2306 21