Josephine is the product manager in charge of the Home Decorating catalogue launched last year by...

 

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Josephine is the product manager in charge of the "Home Decorating" catalogue launched last year by ACME Direct. The first campaign was exactly on budget generating 122,500 new catalogue buyers for ACME. Josephine's boss was quite impressed given the fact she had no prior test mailing upon which to base her selection of names for the catalogue mailing. < As a result ACME has approved a second catalogue mailing for this year. Given the success of the first campaign Josephine is anxious to do even better this time. So she asks her analyst, Herbert, if he could use results from the first campaign to help segment the market prior the next campaign. Luckily Josephine had tested a 10,000 sample of all names on the database last year in anticipation of such an analysis. The resulting analysis produced by Herbert yielded three customer segments as defined below in the cross tabulation of "Total Orders Ever (all ACME product lines)" versus "Total Promotions Ever (all ACME product lines)."< As a result ACME has approved a second catalogue mailing for this year. Given the success of the first campaign Josephine is anxious to do even better this time. So she asks her analyst, Herbert, if he could use results from the first campaign to help segment the market prior the next campaign. Luckily Josephine had tested a 10,000 sample of all names on the database last year in anticipation of such an analysis. The resulting analysis produced by Herbert yielded three customer segments as defined below in the cross tabulation of "Total Orders Ever (all ACME product lines)" versus "Total Promotions Ever (all ACME product lines)."< Total Orders Ever: 0 1-5 6-10 11-15 16 plus 1-5 0.00% (0/0) 0.00% (0/0) 0.00% (0/0) 0.00% (0/0) 0.00% (0/0) 0.00% (0/0) 6-10 0.00% (0/0) 1.63% (8/491) 2.89% (8/277) 0.00% (0/0) 0.00% (0/0) 2.08% (16/768) Total Numbers in each cells are as follows: Catalogue Response Rate = (Catalogue Orders/Total Names)< Total Promotions Ever: 21-30 0.00% (0/0) 11-20 0.00% (0/0) 1.76% (17/967) 1.85% (14/756) 3.03% (14/462) 3.34% (12/359) 2.24% (57/2,544) Super 2.34% (20/856) 2.51% (29/1,154) 3.03% (29/956) 5.03% (30/597) 3.03% (108/3,563) Good 31 plus 0.00% (0/0) 1.60% (16/998) 1.80% (16/887) Total 0.00% (0/0) 1.87% (62/3,312) 2.21% (68/3,074) 2.90% (64/2,205) 2.67% (21/787) 3.53% (16/453) 2.21% (69/3,125) (250/10,000) Poor 3.97% (56/1,409) 2.5% a) Why didn't Herbert base the segmentation scheme on simply catalogue orders and catalogue promotions?< b) Based on Herbert's segmentation, determine the percent each segment represents of the total ACME database of 10,000,000 and the index to total for each. < Josephine is the product manager in charge of the "Home Decorating" catalogue launched last year by ACME Direct. The first campaign was exactly on budget generating 122,500 new catalogue buyers for ACME. Josephine's boss was quite impressed given the fact she had no prior test mailing upon which to base her selection of names for the catalogue mailing. < As a result ACME has approved a second catalogue mailing for this year. Given the success of the first campaign Josephine is anxious to do even better this time. So she asks her analyst, Herbert, if he could use results from the first campaign to help segment the market prior the next campaign. Luckily Josephine had tested a 10,000 sample of all names on the database last year in anticipation of such an analysis. The resulting analysis produced by Herbert yielded three customer segments as defined below in the cross tabulation of "Total Orders Ever (all ACME product lines)" versus "Total Promotions Ever (all ACME product lines)."< As a result ACME has approved a second catalogue mailing for this year. Given the success of the first campaign Josephine is anxious to do even better this time. So she asks her analyst, Herbert, if he could use results from the first campaign to help segment the market prior the next campaign. Luckily Josephine had tested a 10,000 sample of all names on the database last year in anticipation of such an analysis. The resulting analysis produced by Herbert yielded three customer segments as defined below in the cross tabulation of "Total Orders Ever (all ACME product lines)" versus "Total Promotions Ever (all ACME product lines)."< Total Orders Ever: 0 1-5 6-10 11-15 16 plus 1-5 0.00% (0/0) 0.00% (0/0) 0.00% (0/0) 0.00% (0/0) 0.00% (0/0) 0.00% (0/0) 6-10 0.00% (0/0) 1.63% (8/491) 2.89% (8/277) 0.00% (0/0) 0.00% (0/0) 2.08% (16/768) Total Numbers in each cells are as follows: Catalogue Response Rate = (Catalogue Orders/Total Names)< Total Promotions Ever: 21-30 0.00% (0/0) 11-20 0.00% (0/0) 1.76% (17/967) 1.85% (14/756) 3.03% (14/462) 3.34% (12/359) 2.24% (57/2,544) Super 2.34% (20/856) 2.51% (29/1,154) 3.03% (29/956) 5.03% (30/597) 3.03% (108/3,563) Good 31 plus 0.00% (0/0) 1.60% (16/998) 1.80% (16/887) Total 0.00% (0/0) 1.87% (62/3,312) 2.21% (68/3,074) 2.90% (64/2,205) 2.67% (21/787) 3.53% (16/453) 2.21% (69/3,125) (250/10,000) Poor 3.97% (56/1,409) 2.5% a) Why didn't Herbert base the segmentation scheme on simply catalogue orders and catalogue promotions?< b) Based on Herbert's segmentation, determine the percent each segment represents of the total ACME database of 10,000,000 and the index to total for each. <

Answer rating: 100% (QA)

a Herbert didnt base the segmentation scheme on simply catalogue orders and catalogue promotions because these two variables alone do not provide a co... View the full answer