SVKM'S NR"S

SCHOOL 0F BUSINESS MANAGEMENT . /

Academic Year: 2019-20

Program: MASTER 0F BUSINESS ADMINISTRATION year.II Ti:€¥# \

Sul3ject: Marketing Analytics

Date : 14th March, 2020 / r' Batch:2018-20 /

Time:Ol.30 pin to 03.30 pin {2Hrs}

No. of Pages:
Marks: 40 /
FINAL EXAMINATION

Instructions: +

• All questions are compulsory
• This paper has two sections of20 marks each:
Section 1 has Excel based questions and is to
be answered in the same file (including notes
etc. if any). Section 2 bas to be solved on the
Answer Book using pens etc. and submitted
s.eparately
• Figures on the right-hand side indicate full
marks
• Suitable logical assumptions made (if any)
should be mentioned clearly
• The instructions printed on the cover of the
Answer Book should be read carefully

Section 1: to be solved and sub'initted in the same Excel file

-20 marks

Question No. Compulsory Mat.ks

1 Yes 10

A consumer's ranking on an orthogonal design with 12 product profiles involving a comparison of two
different brands of soft drinks is available. The attributes and levels used in the profiles are given below:
• Brand: Coke orpepsi
• Packaging: 12 oz. can or 16 oz. bottle
• Priceperounce: 8 cents,10 cents,12 cents ,
• Caloriesperounce: Oor 15

Determine ( 1) the ranking of the attributes' importance and (2) the ranking of all the attribute levels

The data is provided in the Excel flle named "MctgA-QP (2019-20) -1.xlsx", on the sheet titled "SIC"
• SIC:
o The base data is available in the cells A2:F14.
a The base data can be converted to data to be used for further analysis in the cells 816:G28 using
app ropriate formulas
o The further analysis can be done using output range N2
o For the desired output, the empty cells under "Utility Range" in Column J (J3:J6) and "Importance
Rank" in Column L (L3 :L6) can be filled up appropriately.

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 11111]
Question No. Compu)sory Marks .-r

XYZ Inc. is a company in the utilities domain; it sells power to consumers. XYZ hc. wants to determine how
to maximize the profit earned fi-om a customer whose demand (q) in kilowatt hours (kwh) for power is given
by: q = 20 - 2p. It costs $2 for ABC Inc. to produce a unit of power.

As an analyst yourjob is to assist ABC Inc. to:

a) Optimize a two-part `tariff where the consumer is given an incentive to purchase multiple units of a
product by charging a fixed fee to purchase any number of units combined with a low constant per unit
charge.
b) Compare the profit eared in the two-pat tariff scheme with that earned by following a linear pricing
model, i.e., charging the sane price for each unit sold

You can use the Excel sheet named "MktgA-QP (2bl9-2o) - 1.xlsx" for this puapose. The sheet
titled "SJJ4" is for working on the two part tariff, while the ,one titled "SJB" is for the linear pricing.
• SIA:
o The cells D2 & D3 contain the initial values of the. fked and the variable price components
respectively of the two part tariff scheme. These will be bounded by values 0 and 100 (lower and
upper bounds respectively)
o The cell D4 contains the production cost per unit of power.
o In the colulnn "Prz.ce Pczz.d", enter the appropriate formula to calculate the price paid by the consumer
for the number of units that sthe is buying, as. per the two. part tariff scheme, usin.g the fixed and
variable components of the scheme.
o h the column "Sorp/zfs", enter the appropriate formula to calculate the consumer surplus.
o The solver can be used to work out the optinum fixed and variable component (starting from the
initial values) and the profit at those levels
• slB: f
o The cells are labeled appropriately; enter the appropriate fomulas to calculate the demand and profits
(in the cells 82 & 85 respectively)
o The solver can be used to work out the maximum proflt using the linear model using the optinum
price. , `t

Section 2: to be solved and submitted on a traditional "Answer Book" -20 marks

Question No. Compulsory iferks

-Yes
3 5

What is a factorial experinental design? In vyhaf. situations partial factoria| design can be used? Is Conjoint
analysis a partial or full-faptorial design? +

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 - - ----___._ T._. It``QuestionNo.Compulsory Marks.

4 yes 15

Answer the following questions using the data and details mentioned in the case below:
a) What are assumptions taken in the ROI calculation dorie by M. Ankit? What percentage of incremental
traffic can be attributed to sponsor ads?
b) Calculate the actual ROI.` State the necessary assuniptions taken.

Snap-ball is one of the leading online retailers of the country. Snap-ball uses both display advertising and
search Engine ldvertising running paid search ads on the two major search engines, Engine 1 and Engine 2.
Snap-ball releases its ads in response to keywords used by online consumers, the marketing team classi.fies
these keywords into two broad categories branded and non-branded. Branded keywords include keywords such
as "Snap-ball jackets," and "Snap-ball shirts" that contain` the Snap-ball brand name. Non-branded keywords
include keywords such as "jackets" and t'shirts" that do not contain the Snap-ball brand name. The firm
employs the same strategies for both Engine 1 and Engine 2 for targeting ads, choosing keywords to advertise
on, and ad copies used, and the mix of potential custoiners visiting the company's website from both search
engines in virtually identical; the only difference is that their Engine 2 campaign is much smaller than their
Engine 1 campaign.

Marketing Analytics team at Snap-ball has agreed to meet to discuss the recent advertising reports relating to
paid search efforts. Specifically, it wants to take a deeper dive into ROI calculations on the sponsored search
ads for branded keywords on Engine 1. Most of the team members were very pleased with the numbers for
sponsored search advertising for branded keywQrds on Engine 1 (See Table 1). This data reflects weekly ad
traffic numbers to Snap-ball website from consumer.s clicking on sponsored ad links as well as on organic links
that appear on Engine 1 after a branded keyword is searched. This data reveals that we obtain about 20% of our
traffic for these branded keywords through the sponsored ads that we show on Engine 1.
Snap-ball was planning to run our sponso+red ad campaign for 12 weeks, but there was a technical glitch in the
systems starting week 10, at which point they suspended our Engine 1 campaign. However, their Engine 2
campaign was unaffected by this glitch. Taking this into account, team ignored the Engine 1 numbers for weeks
10,11, and 12, since no sponsored search advertising was going on at that time. They focused on the data from
weeks 1 to 9.

Table 1: Weekly trafflc from Engine 1 by origin of click

Week 12345 6 7 8 9 10 11 12 I

Sponsored 31,000 32,000 32,loo 31,417 31,200 31,576 31,000 30,611 30,400 0 0 0 I

Organic 125,000 1,29,000 I,26,000 126264 123,871 I,24,053126,105123,064121,6371,50,1881,48,6581,46,584 I

Table 2: Weekly trafflc from Engine 2 by origin of click

Week 123456 7 8 9 10 11 123,8903,8703,8403,8003,7603,75019,39019,17019,34018,99018,92018,780

Sponsored 3,900 3,850 3,960 3,950 3,880 3,900

Organic 19,700 19,850 19,760 19,800 19,530 19,700

Team Leader-Ankit presented the following ROI analysis calculations: We know that the average cost per click
for a sponsored click is $0.60. Once consumers land on Snap-ball website, their average probability of making a
purchase from our website is 12% and our average margin per conversion is $21. So that leads to an average
revenue per click of 0.12 x $21, or $2.52, which implies on ROI of($2.51-.$0.60)/0.60, or 320.0%.

However, data scientist - Mr. Sunil raised the following points: My main concern is that these keywords
searches include the name of our company. These consumers seem to be already aware of our website and
actively looking for it. I wonder if we even need to show the sponsored ads to them. Suppose a consulher used ,
the search term "Snap-ball Shoes" and clicked on our sponsored ad that came up in the results. If the a`d weren't
there, my guess is that this consumer would be very likely to simply click on our link in the organic list, and so
we would get the same consumer for free. We also know that the conversion probability and margin per
conversion number are the same for all consumers, inespective of how they landed up at our website.

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