This project focuses on optimizing a year-end sale campaign for a superstore by offering a gold membership exclusively for existing customers, priced at $499 (down from $999), which provides a 20% discount on all purchases. The goal is to identify which customer segments are most likely to purchase this offer. By predicting the most responsive customers, the store aims to reduce campaign costs and maximize sales through a targeted marketing approach.
The dataset contains various customer demographics, purchase history, and responses to past campaigns, can be found here.
This project aims to identify which customers are most likely to avail the new gold membership offer, helping the superstore reduce marketing costs while boosting sales. Using customer demographics, purchase behaviors, and past campaign responses, a dashboard using Power BI was developed to predict customer responses and analyze key factors driving their behavior.
Key observations indicate that Elite Customers—primarily adults who recently made purchases—account for 86% of total sales. Married and graduated individuals show a strong likelihood to buy the membership, especially those who prefer non-vegetarian items like meat and fish. While in-store purchases dominate, efforts to encourage online sales should be explored. Married couples are particularly interested in Gold Products, providing a strong revenue source.
- Excel for Data Cleaning
- Power BI for Dashboard Creation
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Cleaned the uncleaned dataset using Excel for Marketing Campaign Analysis.
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Performed following transformation on data using Power BI
- to remove duplicate rows,
- to replace numerical values of responses to text values,
- to create new columns using DAX functions for creating calculated columns, measures, and custom tables,
- to visualize data to predict below mention observations and recommendations.
Power BI — Marketing Campaign Dashboard Report, can be downloaded from here
Here is the glimpse of dashboard.
- 86% of total sales come from the Elite Customer category, which consists of high-value customers who regularly make purchases.
- This segment is the most likely to respond positively to the gold membership offer.
- Potential Customers consist mostly of Married individuals and those with a higher education are more likely to make purchases
- They exhibit a preference for non-vegetarian items, such as meat and fish, accompanied by wine.
- Customers prefer in-store purchases over online shopping, with Elite Customers showing low engagement with online offers.
- Consequently, the utilization of online offers by our Elite Customers is relatively low.
- The store has maintained a low complaint rate over the years, indicating high levels of customer satisfaction.
- This is a positive indicator of customer satisfaction and demonstrates that people prefer purchasing items from our store.
- Married couples have shown consistent interest in Gold Products over the past three years, making them an important target for special promotions.
- This demographic segment represents a significant source of revenue, and targeted marketing efforts can be tailored to their preferences and needs.
Based on the key observations, the following recommendations can be made to address the problem statement:
- Focus the gold membership campaign on Elite Customers, who account for a significant share of total sales and are most likely to purchase the offer.Thereby reducing campaign costs by targeting the most responsive segment.
- Within the Elite Customer Category, prioritize married or graduated individuals, who are more likely to make purchases, according to this data. Allocating a larger portion of the campaign efforts towards contacting this specific customer segment with appropriate promotions and offerings to maximize their engagement and conversion rates.
- Focus on maintaining and further improving this high level of customer satisfaction by tailoring the offer align with the preferences of potential customers, as identified in the observations. Emphasize the availability of non-vegetarian items, such as meat and fish, and the option to enjoy them with wine, to appeal to the target audience that must be delivered to the customers on time and fresh to built our online presence.
- While store purchases are predominant, explore strategies to incentivize Elite Customers to highlight the convenience and ease of online transactions, ensuring that customers are aware of the benefits and discounts available to them, to increase online purchases and utilize the gold membership offer through the website.
- Given that married couples have consistently shown a high propensity for purchasing Gold Products, to cater this category some special offers or exclusive discounts for Gold Products, specifically catering to the preferences and needs of married couples.
- Regularly analyze customer data, customer feedbacks and campaign result to refine and optimize the target promotions for future campaigns.
- Keep track of customer response rates, conversion rates, and overall campaign effectiveness to make data-driven adjustments and improvements.
- The data accurately reflects customer behavior and preferences, particularly in relation to their purchasing habits and responses to promotions.
- Elite Customers will continue to exhibit the same purchasing patterns in future campaigns, and their preference for in-store shopping will not shift dramatically.
- The predictive model relies on past data, which may not fully capture changes in customer preferences or external factors like economic shifts.
- While the gold membership is priced attractively, it may not appeal to all customer segments equally, and the effectiveness of the campaign may vary across regions or customer demographics.
By implementing these recommendations, the superstore can effectively reduce campaign costs while targeting the right customers with the gold membership offer. The predictive model will play a crucial role in identifying potential buyers, allowing for a more efficient and targeted campaign approach.
Note: The observations and recommendations presented here are based on the available data and provide valuable insights for management decision-making. Further analysis and exploration of these findings can uncover additional opportunities for growth and optimization within the company.