“Body Language” - the Online Version

Bloomberg’s Leonid Bershidsky writes about research findings from the files of a German firm that sells furniture online. Looking at sales to over a quarter of a million customers, they have found correlates of who is, and is not, likely to default on payment.

Difference in loan default rates between iPhone and Android owners “is equivalent to the difference in default rates between a median FICO score and the 80th percentile of the FICO score.” iPhone ownership, apparently, is a reliable proxy for higher income and thus for creditworthiness.

Those who order from mobile phones are three times as likely to default as those who order from desktops. A customer who arrives at a shopping site from a comparison engine is twice as likely to default as one who clicks on a search engine ad.

A customer who uses her name in her email address is 30 percent less likely to default than one who doesn’t. But it’s better if the email address is linked to a paid internet or cable package than if it’s from a free service, especially an outdated one like hotmail.com or yahoo.com. And it’s better if the address contains no numbers.

Those who shop between noon and 6 p.m. are half as likely to default as midnight to 6 a.m. buyers. Businesses can also expect more trouble from those who make an error when typing in their email address or put in their name and address in all lowercase letters.

Isn’t data mining wonderful? Most of those findings make perfect sense. I can easily envision the firm requiring prepayment from prospective purchasers who trip a number of these “indicators of iffiness.” Hat tip to Lucianne.com for the link.