Reference no: EM131725091

Your write-up and Access database with a segmentation table and query.

Background

The two keys to having a successful online business are generating traffic and monetizing it. Amazon has been very successful at both. They have tens of millions of customers and they sell books and other products to them, as well as Kindles and eBooks, as well as the products of other retailers. In this hypothetical assignment we are considering the possibility of Amazon augmenting its monetization efforts by promoting by email a set of product it calls "Amazon's Best." The database marketing techniques they utilize are similar to those that have been used by traditional book clubs for years. Note that the Amazon's Best program could promote any types of products, i.e., it's not just limited to books.

Using the information in the above tables, Amazon's Best wants you to develop a set of criteria for deciding what customers should receive the offer for "The Art History of Florence". Amazon will handle Amazon's Best fulfillment through their regular fulfillment operation. The business unit generates $7 of profit for each book sold. Your task is to decide which customers should receive the offer.

Part 1 If you have not recently completed the exercises, you should review or do those before doing starting the assignment. If you can't do the exercises, the assignment will be extremely hard.

Segment the customers by the Recency, Frequency, and Monetary (RFM) variables, using the following breakdown (note that this breakdown leads to a total of 8 segments (be sure you understand why)):

Recency:               less than 7 months 7 months and up

Frequency:            less than 3 purchases 3 or more purchases

Monetary:             less than $200 $200 and up

Which of these segments should receive the offer for "The Art History of Florence"? What is the corresponding expected roll profit?

NOTE: you can save the query result as an Excel spreadsheet and calculate the expected profit in Excel if you wish.

Part 2 Decide on a segmentation of your own using whatever variables you like and see if you can find a better strategy than the Recency, Frequency and Monetary one in Part 1. What is your expected profit?

Again, you can use Excel to calculate the expected profit. In addition, you may wish to create a query with most or all of the fields in the Customer table and Art History from the Current Book table, and then save the result in an Excel spreadsheet (using the Save As command and changing the file type) for some analysis to help you determine your segments. Minimum, maximum, averages, and correlations, would all seem to be potentially useful. None of this is mandatory and some common sense and experimentation can also lead to a profitable segmentation. If you do any analysis be sure and briefly describe it and/or include it in your write-up.

Be sure to specify which segments you wish to make the offer to in the roll phase. A list of segment numbers is sufficient.

Attachment:- Amazon - assignment.rar