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Tuango docx

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Tuango – RFM analysis Part I: Preliminary and Quintile Analysis 1. What percentage of customers responded (i.e. bought anything) after the push message? 3.1% customers responded to the push message. 2. Of those who bought, what was the average spending? (Hint: constrain the summary command with the buyer==1”) 202.3565 3. Create quintile variables for recency, frequency and monetary. (Hint: review the file “RFM_BBB.R” which goes through the calculations for the Bookbinders RFM analysis) 4. Create a bar chart showing the response rate (i.e., the proportion of customers who bought something) to this deal by recency quintile. 5. Create a bar chart showing the response rate to this deal by frequency quintile. 6. Create a bar chart showing the response rate to this deal by monetary quintile. 7. Repeat questions 4-6 using only those customers who placed an order after the push message, i.e. create bar charts showing the average spending (in RMB) spent by recency, frequency and monetary quintile. 8. What do the above bar charts reveal about the likelihood of response and the size of the order across the different recency, frequency, and monetary quintiles? The charts plotted above reveal that recency and frequency do not corelate much with the average amount spent by the customers, but monetary does corelate that the more the customers spend the higher the average amount spent will be. Part II: Profitability Analysis 9. What is the breakeven response rate? 0.0247 ...
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