A Comparative Analysis of Support Vector Machines & Logistic Regression for Propensity Based Response Modeling

2015 ◽  
Vol 3 (1) ◽  
Author(s):  
K. V. N. K. Prasad ◽  
G.V.S.R. Anjaneyulu
Keyword(s):  
Logistic Regression ◽  
Support Vector Machines ◽  
Support Vector ◽  
Design Strategies ◽  
Bottom Line ◽  
Response Models ◽  
Customer Base ◽  
Customer Life Cycle ◽  
Product Service ◽  
Vector Machines

Increasing cost of soliciting customers along with amplified efforts to improve the bottom-line amidst intense competition is driving the firms to rely on more cutting edge analytic methods by leveraging the knowledge of customer-base that is allowing the firms to engage better with customers by offering right product/service to right customer. Increased interest of the firms to engage better with their customers has evidently resulted into seeking answers to the key question: Why are customers likely to respond? in contrast to just seek answers for question: Who are likely to respond? This has resulted in developing propensity based response models that have become a center stage of marketing across customer life cycle. Propensity based response models are used to predict the probability of a customer or prospect responding to some offer or solicitation and also explain the drivers– why the customers are likely to respond. The output from these models will be used to segment markets, to design strategies, and to measure marketing performance. In our present paper we will use support vector machines and Logistic Regression to build propensity based response models and evaluate their performance.

scholarly journals Bankruptcy Prediction of Engineering Companies in the EU Using Classification Methods

2018 ◽  
Vol 66 (5) ◽  
pp. 1347-1356 ◽  
Author(s):  
Michaela Staňková ◽  
David Hampel
Keyword(s):  
Logistic Regression ◽  
Support Vector Machines ◽  
Binary Classification ◽  
Classification Tree ◽  
Classification Trees ◽  
Bankruptcy Prediction ◽  
Support Vector ◽  
Type I ◽  
Vector Machines ◽  
The Eu

This article focuses on the problem of binary classification of 902 small- and medium‑sized engineering companies active in the EU, together with additional 51 companies which went bankrupt in 2014. For classification purposes, the basic statistical method of logistic regression has been selected, together with a representative of machine learning (support vector machines and classification trees method) to construct models for bankruptcy prediction. Different settings have been tested for each method. Furthermore, the models were estimated based on complete data and also using identified artificial factors. To evaluate the quality of prediction we observe not only the total accuracy with the type I and II errors but also the area under ROC curve criterion. The results clearly show that increasing distance to bankruptcy decreases the predictive ability of all models. The classification tree method leads us to rather simple models. The best classification results were achieved through logistic regression based on artificial factors. Moreover, this procedure provides good and stable results regardless of other settings. Artificial factors also seem to be a suitable variable for support vector machines models, but classification trees achieved better results using original data.

scholarly journals MODEL PREDIKSI FINANCIAL DISTRESS PADA PERUSAHAAN MANUFAKTUR SEKTOR INDUSTRI BARANG DAN KONSUMSI

2019 ◽  
Vol 3 (2) ◽  
pp. 77
Author(s):  
Herlina Herlina ◽  
Ahmad Ridho’i ◽  
Anggie Erma Yunita ◽  
Mega Puja Azhari ◽  
Ade Reynaldi Saputra
Keyword(s):  
Logistic Regression ◽  
Particle Swarm Optimization ◽  
Support Vector Machines ◽  
Discriminant Analysis ◽  
Financial Distress ◽  
Particle Swarm ◽  
Support Vector ◽  
Multiple Discriminant Analysis ◽  
Swarm Optimization ◽  
Vector Machines

Kesulitan keuangan (financial distress) adalah sebuah tahapan yang akan dilalui oleh sebuah perusahaan sebelum mengalami kebangkrutan. Dengan alasan tersebut maka kemampuan untuk memprediksi kesulitan keuangan dapat menjadi informasi yang bermanfaat bagi perusahaan maupun investor. Penelitian mengenai financial distress sudah dimulai dari penelitian Altman pada tahun 1968 menggunakan metode Multiple Discriminant Analysis (MDA). Dimulai dari penelitian Altman, muncul penelitian-penelitian lainnya menggunakan pengembangan metode statistik, seperti Logistic Regression. Dari metode statistik kemudian berkembang dengan munculnya penelitian-penelitian menggunakan metode-metode kecerdasan buatan, serta algoritma evolusi untuk berusaha mendapatkan model prediksi financial distress yang akurat. Tujuan dari penelitian ini adalah untuk membandingkan tingkat akurasi dari model prediksi financial distress perusahaan manufaktur terbuka pada sektor industri barang konsumsi yang terdaftar pada Bursa Efek Indonesia menggunakan metode kecerdasan buatan serta algoritma evolusi. Metode yang digunakan untuk metode kecerdasan buatan adalah metode Support Vector Machines dan untuk model algoritma evolusi menggunakan metode Particle Swarm Optimization-Support Vector Machines. Tingkat akurasi dari masing-masing metode akan diukur dari prosentase misklasifikasi terkecil yang dihasilkan. Dari pengujian model menggunakan metode Support Vector Machines, didapatkan tingkat misklasifikasi terkecil sebesar 11,11% dengan menggunakan Kernel Linear dan untuk metode Particle Swarm Optimization-Support Vector Machines, didapatkan tingkat misklasifikasi terkecil sebesar 5,56% dengan menggunakan Kernel RBF, ? = 2.

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