A Fuzzy Mathematical Programming Approach for Cross-Sell Optimization in Retail Banking

T. Bhaskar, R. Sundararajan, and P.G. Krishnan (India)

Keywords

Crosssell, Mailer Selection, Constrained Programming, Fuzzy Mathematical Programing

Abstract

In this paper we discuss the mailer selection problem in retail banking. Mailer selection takes estimates of sev eral parameters (like response probability of a customer, expected volume, expected profit from a customer etc.) and decides on the list of customers to whom the offer should be sent such that a certain set of business objectives are met/optimized. We discuss some of the issues (unre liable estimates and computational complexity) related to the mailer selection process and propose solution to the problems. We propose a fuzzy mathematical programming technique to take care of the imprecise estimates of the parameters. The imprecise parameters and constraints are represented as triangular fuzzy numbers. We use a simple example to demonstrate the method.

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