AGEING POPULATION Burden or Benefit

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AGEING POPULATION- Burden or Benefit?

• 20-22 January 2002
• Balmoral Hotel, Edinburgh
• Tina Harrison Jake Ansell
• School of Management, The University of Edinburgh

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RATIONALE FOR THE STUDY

• Need to understand the financial behaviour of
  older individuals
• Emphasis on customer retention and relationship
  development
• Need to track financial requirements and
  behaviour in order to retain individuals as they
  mature.

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AIMS OF THE STUDY

• To identify lifestage segments
• To compare and contrast the characteristics and
  behaviour of different lifestage segments.
• To develop separate propensity models
• To provide an indication of retention and
  relationship potential over the lifecycle.

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METHOD OF RESEARCH

• Sample of 18,000 customers of a large
  international insurance company.
• Cluster analysis identified 6 lifestage segments.
• Propensity modelling using logistic analysis.
• Survival analysis revealed differences in
  retention probabilities of segments.

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SIX LIFESTAGE SEGMENTS
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SURVIVAL PLOT FOR GENERIC MODEL WITH INTERACTION
INCLUDED
Survival probability
Time in days
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SURVIVAL PLOT FOR CLUSTER 5
Survival probability
Time in days
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CONCLUSION

• 6 lifestage segments identified exhibiting
  differences in
• characteristics, and
• behaviour
• Mature individuals constitute a distinct
  segment for financial services
• in terms of distinct profiles, and
• potential for retention.
• Findings illustrate the potential for retention
  and relationship building over the lifecycle.