AVALON Cosmetics sells door-to-door cosmetics much like Mary Kay. Women work as independent contractors for commissions and
Question:
AVALON Cosmetics sells door-to-door cosmetics much like Mary Kay. Women work as independent contractors for commissions and bonuses. Total company revenues have fallen 5% for each of the past two years! Customers report that they are highly satisfied with the product. Customers say the price is right and are repeat customers. In fact prices have been increased only to cover inflation over the past two years. Some concern has been expressed over the company’s perception of the profile of its customers. Some managers feel the customers are primarily women staying at home with their children. However, recent articles about increasing numbers of working women made others question the profile. Based on some
existing data on customer history that is kept by the beauty consultants, three samples of 100 customers were selected from the summers of 1990, 1991, and 1992. The database complied contained the following information.
(Ratio variable)
Year Month Day Purchase Price Number of Contacts Time of Day Employed Age No. of Children
2003 6 12 3.53 1 1 0 35 2
2002 7 15 10.50 3 3 1 36 1
2004 8 20 15.55 2 2 1 26 0
The variables are defined as follows:
Year: Year in which purchase was made.
Month: Month purchase was made ,e.g., 6 = June, 7 = July, 8 = August
Day: Day of purchase
Purchase Price: Retail dollar amount of purchase
Number of Contacts: Number of times agent visited home before making contact with customer (Ratio)
Time of Day: 1 = Morning
2 = Afternoon
3 = Evening
Employed: 1 = Customer employed outside of home
0 = Otherwise
Age: Age in years
Number of Children: Number of children living at home