Please read through the case situation below. Indicate the following:

1. Draw the causal model.
2. What methods would you use for data collection?

Case:

You are the Chief Analytics Officer & Business Strategy Head at an online shopping store called DresSMart Inc. The company wants to improve the conversion rate of the campaigns i.e. number of customer buying products from the product catalog. Their campaigns include price reductions, advertisement with celebrities, gifts for buyers or large quantities and a loyalty card.

They are also eager to find out what are the best selling product categories. Their catalogue features male wear, female wear, children wear and household items.

They also want to know what is the average amount of money spent at one go, and see if there are differences between customers living in large cities, mid-sized cities and small towns. This data is used to help improve the profit generated through the converted customers.

To develop a regression model you will use the data for 4200 customers, out of hundred thousand solicited customers, those have responded to previous campaigns. All these 4200 customers live in different locations that can be grouped into the above three categories.

Incidentally, these customers are evenly divided into these three categories with 1400 customers in each group. The first thing you checked is the average value of profit generated from these three categories of cities.