Divide and prosper: comparing models of customer behavior from populations to individuals

This paper compares customer segmentation, 1-to-1, and aggregate marketing approaches across a broad range of experimental settings, including multiple segmentation levels, marketing datasets, dependent variables, and different types of classifiers, segmentation techniques, and predictive measures. Our experimental results show that, overall, 1-to-1 modeling significantly outperforms the aggregate approach among high-volume customers and is never worse than aggregate approach among low-volume customers. Moreover, the best segmentation techniques tend to outperform 1-to-l modeling among low-volume customers.