1.
Taskabella conducted this marketing campaign using an experimental design.
What was the conversion rate? Explain whether or not you believe the
advertising campaign was effective. (15 points)
The conversion rate was approximately 2.54%, calculated from 15,000 handbag
purchases out of about 590,000 users targeted.
Luxury products, such as Taskabella's handbags, can exhibit lower conversion rates
because of their higher
price and targeted
markets. Therefore, the observed
conversion rate of 2.54% is significantly remarkable.
2.
What was the increase in revenue, assuming $40/handbag, resulting from the
campaign? (15 points)
The increase in revenue resulting from the campaign was $600,000 calculated by
multiplying the 15,000 handbags sold with the price of $40 per handbag.
3.
What was the ROI of the campaign based on revenue (10 points)
Total Revenue = Number of Handbags Sold * Price per Handbag = 15000*40 =
600000
Total Cost = (Total Impressions / 1000) *
Cost per Thousand Impressions =
14500000/1000*9 = 130500
ROI = (Total Revenue - Total Cost) / Total Cost = 359.77%
4.
What age group(s) represent Taskabella’s major customer demographic?
Explain the rationale for your answer (50% of sales)?
(10 points)
All 3 age groups are of similar level. The second group has a high proportion of
34.8%. The third group is slightly lower, at 34.0%. The first group accounts for 31.2%
of total sales.
5.
What income group(s) represent Taskabella’s major customer demographic
(50% of sales)? (10 points)
There is no group dominating that come closer to 50% of sales. The highest group,
accounting for 26.9% of sales, was the third group with annual income range from
50K to 100K. The 4
th
group with income from 100K to 150K ranked second with the
25.5% of sales. The group ranked third is much lower with a percentage of just 16.6.
It is the group of customers with income ranging from 150K to 200K.
