Moderator:

1

• Moderator
• Brian Sterrett
• VP and General Manager, Enabling Technologies
  Division, SPSS Inc.

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Agenda

• Predictive Analytics Market Opportunity
• SPSS Enabling Technologies
• Case Study Clementine 8.5
• Case Study Alterian Modeling 1.0
• QA

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Who is SPSS?

• Leadership
• Market leader in Predictive Analytics
• Experience
• 250,000 customers
• 30 year heritage in analytic technologies
• Stability
• Founded in 1968
• 210M in revenue FY2003
• NASDAQ SPSS
• Analytics gold standard
• 80 of Fortune 500 are SPSS customers

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Predictive Analytics Defined

• Predictive analysis helps connect data to
  effective action by drawing reliable conclusions
  about current conditions and future events.
• Gareth Herschel, Research Director, Gartner
  Group

5
Documented ROI for Predictive Analytics
Investment and overall return predictive
projects versus nonpredictive projects
Source IDC, 2003
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Proven Success ROI
Industry
Company
Need
Results
Reduced manualreviews by 40
Fraud Detection
Retail
Web Analytics
9M return in 5 months
Entertainment
7
The Analytic Enterprise
8
Sample Applications Powered by SPSS

• Predictive CRM
• Real-time offer optimization
• Attrition / churn management
• Targeted marketing / segmentation
• Fraud detection and analysis
• AML
• Telco
• Healthcare billing
• Demand Forecasting
• Risk Management

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SPSS Enabling Technologies Division

• We help software companies grow their business
  with predictive analytics applications Powered by
  SPSS.
• SPSS delivers the OEM technology, expertise and
  brand recognition that enables our partners to
  succeed.

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World-class OEM customers
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Were OEM Ready

• Expertise
• Modeling
• Predictive Analytics Application Design
• Applications
• PredictiveMarketing
• Tools
• SPSS Lexiquest
• Clementine
• Components
• Time-Series Concept Extractor
• Two-Step Cluster Visualization SDK
• Scoring Engine Naïve Bayes
• Web Importer Neural Network

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Clementine Utilization of Enabling Technologies

• Laura Squier
• Sr. Product Manager, Clementine, SPSS Inc.

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The Clementine Data Mining Workbench

• World-class solution for highly scalable data
  mining and rapid deployment
• Supports the entire data mining process
  including
• Data access
• Data understanding and visualization
• Data preparation
• Modeling using
• Machine learning technologies
• Statistical analysis techniques
• Model understanding
• Model deployment

http//www.spss.com/spssbi/clementine/index.htm
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Advantages of Leveraging SPSS Components

• Provide major product release every year
• Minimize development time
• Re-use rather than, rather than re-build
  capabilities
• Use development resources who have domain
  expertise for the particular capability
• The statistics team provides statistical
  components
• The visualization team provides the visual
  components
• Quickly implement
• Components are delivered with well-designed
  programming interfaces facilitating easy
  integration into the Clementine code base
• Deliver more features in less time

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Component Utilization in Clementine Technologies

• SPSS nViZn technology - development platform
  offering advanced visualization techniques,
  analytics, and interactivity
• Multinomial Logistic Regression
• OLS Regression
• Factor and PCA Analysis
• Two-Step Cluster
• Sequence Association
• CRT
• CARMA
• Tree Viewer
• Cluster Viewer
• SmartScore
• Scoring Engine

• Data understanding and visualization
• Modeling using
• Statistical analysis technologies
• Machine learning
• technologies
• Model understanding
• Data scoring and model deployment with Cleo and
  Solution Publisher

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Implementation of Modeling Components

• In Clementine, an input adapter gets the data
  from the Clementine Stream and sends it to the
  component.
• The component processes the data, creates the
  model, and produces it with other information as
  output.
• Clementine retrieves the output.

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Results

• Shorter development cycles
• Fully supported and QAed components, ready to
  implement
• More than doubled the features added to
  Clementine in one release.
• More productive and robust technology that
  attracts new customers and retains existing
  customers.

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• Case Study
• Alterian Embeds
• Best-of-Breed
• Data Mining Components
• Richard Clarke
• Product Manager, Alterian

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Alterian

• High speed Analytical Database Platform
• Initially
• Enabling technology
• Partners producing applications
• More recently
• Applications
• Marketing focus

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The Requirement

• Gap in the data mining area
• In particular for predictive modeling and
  clustering
• For applications such as
• Response analysis
• Churn analysis
• Customer segmentation
• Needed to address quickly

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Options

• Create
• Too time-consuming and not enough internal
  expertise in this area
• Acquire
• Not much choice and expensive unless choose an
  unknown
• OEM
• Established technology at a reasonable price

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Why SPSS?

• Trusted brand
• Breadth of coverage
• Componentized algorithms

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The Components

• Linear regression
• Future profitability or spend prediction
• Logistic regression
• Propensity to respond/churn prediction
• Clustering
• Identification of groups of similar behaving
  customers
• CandRT
• Rule detection in relation to specific behaviours
• Associations
• Basket analysis
• Sequential patterns
• Identification of related customer actions

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The Integration

• Picked simplest first linear regression
• Well documented API
• SPSS experts on hand
• Standard PMML output model
• Weeks to completion

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The Integration

• Commonalities across components
• Made subsequent components integration easier
• Ability to expose subsets of options
• Integration of 5 out of 6 components in 3 months
• Launched in April 2003

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Alterian Modeling

• A broad data mining application
• Running on Alterians rapid Engine database
• Totally integrated with other Alterian
  applications
• A suite that provides end-to-end data mining
  capability through
• Data exploration
• Data preparation
• Model building
• Model validation and interpretation
• Database scoring
• Actioning, via campaign management

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Market Impact

• Can now offer a complete Marketing Suite
• Has been a great up-sell opportunity
• Two clients bought the same day they saw it
• Has also leveraged full suite sales
• 50 organizations now using Alterian Modeling

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Where Next?

• Expose more options within components (for expert
  usage)
• Finish integrating sequential patterns component
• Automate more of the data mining methodology
• Integrate more SPSS components, such as
• Tree Viewer
• Cluster Viewer
• Scoring Engine

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QA
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Thank You

• Contact Information
• Brian Sterrett
• [phone]
• Bsterrett_at_spss.com
• Log onto our website for more information
  www.spss.com/spssetd
• or call 800-259-1028