What is interpreted by Responder (target) variable as 1 or 0? Does 1 mean customer has churned out or opened a savings account?? The question is not clear. What are we supposed to predict?? Please help here.
Same Question is the responder the Target variable ? as the question was predict for customers whose worth reduces by 50 % and one more sayng opt for the savings account . If some one can explain the problem statement a bit better it would be helpful.
In one statement it is written that - ‘BoG wants you to identify customers likely to churn balances in the next quarter by atleast 50% vis-a-vis current quarter’.
‘Estimate the probability of customer to opt savings account’ - and also this also written.
So what we have to predict ? - Customers withdrawing 50% of their balance in next year or customer closing their Savings account?
Kindly respond. whether Responder is target variable & What 0 & 1 stand for?
Well I was also confused with the problem statement, but this is what I’ve interpreted so far, and I’m welcome to new ideas -
- The customer base given in train will be as of a certain date, and comprises of all customers (churned / new / existing etc.)
- Responders are the customers who have churned from the bank in some period, and are tagged by 1.
- Its not necessary that the responders will have declining AQB’s by 50% in two consecutive quarters following the churn. Hence, we see flag of 1 for some customers, whose balances have increased as well.
- The problem statement here is to predict customers who will be churning / or declining their AQB’s by 50% from current to next quarter. So it might be a good idea to create a separate response variables - one for AQB, and one for churn, and predict them separately!