Description
This is a presentation describes about market research book club.
Marketing Research
“BOOK CLUB ”
RFM model analysis on the book “the Art History of Florence”
THE RFM MATRIX NUMBER OF CUSTOMERS in Holdout Sample
111 121 131 112 113 122 123 132 133
222 212 232 211 213 231 233 221 223
333 323 313 332 331 321 322 312 311
4 8 1 70 48 151 128 48 44
334 131 110 43 39 56 36 126 87
13 47 21 118 45 136 271 136 49
NUMBER OF CUSTOMERS in Customer Choice Temp.
1 2 1 42
185 116 122 47
19 27 19 108
46 78 57 48 39
32 35 29 80 54
48 74 167 91 33
The matrix regarding less frequent and recent customers
INCREASING RECENCY AND FREQUENCY 2300 handout
48 128 44
39 36 87
21 47 13 INCREASING RECENCY AND FREQUENCY 1600 template
46 57 39
32 54 29
19 27 19
Few suggestions on basis of RFM model • Basically, customers who end in 3 from RFM matrix are the ones who generate a revenue of more than $ 285 which means that generating more purchases from these 463 customers which create a positive impact on the revenue for the firm. Now, the ones in lower left hand corner are the ones who were amongst very important customers few months from now and have moved in the wrong direction which means BBBC has to take steps to make them come back otherwise they would be
gone. Hence, continuous e-mails to these 131 customers should be sent so that they come back and add up to the 333 grid. Similarly, indicated 68 people should be sent emails regarding the variety of books available and emphasis should be laid on how to increase their no. of purchases.
Regression analysis
Analysis on basis of regression After the basic analysis it was found that primacy was a repetitive variable and had no impact on choice of customer with low significant value. So, that variable was removed. Next , again performing regression on rest of the variables, we found that each of them was significant but looking at the beta values made us realize that recency was the most important variable for purchase of the book “The Art History of Florence”. The second variable whose beta coefficient signified substantial value was number of art books that the customer brought.
Regression analysis
Comparison of 2300 holdout sample with 1600 choice template
• •
After comparing , it can be seen that while amount was not an important variable in holdout sample, it turned out to be an important one in choice template. Moreover, the impact of variables is biased in choice template because of the bias in data.
Relating RFM and regression model
Combination of RFM and regression model We have basically tried to perform regression analysis on the 333 column customers and the results which we got are were haywire as can be seen because of 2 reasons: • • The sample size was too small The analysis through RFM model was very basic and it gave no clue whether a customer will buy this new book or not
doc_739265351.doc
This is a presentation describes about market research book club.
Marketing Research
“BOOK CLUB ”
RFM model analysis on the book “the Art History of Florence”
THE RFM MATRIX NUMBER OF CUSTOMERS in Holdout Sample
111 121 131 112 113 122 123 132 133
222 212 232 211 213 231 233 221 223
333 323 313 332 331 321 322 312 311
4 8 1 70 48 151 128 48 44
334 131 110 43 39 56 36 126 87
13 47 21 118 45 136 271 136 49
NUMBER OF CUSTOMERS in Customer Choice Temp.
1 2 1 42
185 116 122 47
19 27 19 108
46 78 57 48 39
32 35 29 80 54
48 74 167 91 33
The matrix regarding less frequent and recent customers
INCREASING RECENCY AND FREQUENCY 2300 handout
48 128 44
39 36 87
21 47 13 INCREASING RECENCY AND FREQUENCY 1600 template
46 57 39
32 54 29
19 27 19
Few suggestions on basis of RFM model • Basically, customers who end in 3 from RFM matrix are the ones who generate a revenue of more than $ 285 which means that generating more purchases from these 463 customers which create a positive impact on the revenue for the firm. Now, the ones in lower left hand corner are the ones who were amongst very important customers few months from now and have moved in the wrong direction which means BBBC has to take steps to make them come back otherwise they would be
gone. Hence, continuous e-mails to these 131 customers should be sent so that they come back and add up to the 333 grid. Similarly, indicated 68 people should be sent emails regarding the variety of books available and emphasis should be laid on how to increase their no. of purchases.
Regression analysis
Analysis on basis of regression After the basic analysis it was found that primacy was a repetitive variable and had no impact on choice of customer with low significant value. So, that variable was removed. Next , again performing regression on rest of the variables, we found that each of them was significant but looking at the beta values made us realize that recency was the most important variable for purchase of the book “The Art History of Florence”. The second variable whose beta coefficient signified substantial value was number of art books that the customer brought.
Regression analysis
Comparison of 2300 holdout sample with 1600 choice template
• •
After comparing , it can be seen that while amount was not an important variable in holdout sample, it turned out to be an important one in choice template. Moreover, the impact of variables is biased in choice template because of the bias in data.
Relating RFM and regression model
Combination of RFM and regression model We have basically tried to perform regression analysis on the 333 column customers and the results which we got are were haywire as can be seen because of 2 reasons: • • The sample size was too small The analysis through RFM model was very basic and it gave no clue whether a customer will buy this new book or not
doc_739265351.doc