19
Answers
Marcadia
11. B – From the introductory paragraphs, the Managing Director is looking to find
ways to encourage customers to adopt purchasing behaviors that more valuable
customers are known to have. Given that a customer needs to make more
purchases to become more valuable to Marcadia, this could be rephrased as
‘encouraging customers to spend more’. Option A refers to customers who stop
purchasing, who are not mentioned by the Managing Director. Option C refers
to driving growth purely through focusing on customers of greatest value, which
is also not a true reflection of the Managing Director’s opinion. Option D refers
to ‘predicting’ purchasing behavior, which is not mentioned by the Managing
Director.
12. B – Profit margin cannot be calculated from the data in Exhibit 3 as revenue
data is only presented for the first 90 days. Option A is a reasonable conclusion
based on the relationship between revenue in the first 90 days and one year
value. Option C can be concluded by calculating the average of the ‘Number
of Transactions’ column, which equals 2.44. Option D can be concluded by
calculating the average of the ‘Average One Year Value’ column.
13. D – Average transaction revenue can be calculated by dividing total revenue
by number of transactions. The ranking, from lowest to highest. is 1 ($71.82),
3 ($80), 2 ($85.38), 5 ($85.96), 4 ($97.31).
14. C – There are 100,000 customers in each quintile. For each of the first four
quintiles, calculating the difference in one year value versus the next highest
quintile gives $0.50, $1.50, $5.00 and $18.00 respectively. Multiplying each by
100,000 and summing gives $50,000 + $150,000 + $500,000 + $1,800,000 =
$2,500,000.
15. A – For customers purchasing Electronics, there was a 3.8% lift in transactions,
and a 5% lift in number of customers making transactions. Therefore the
number of transactions per customer compared to the control group was
103.8%/105% = 98.9%, ie a ‘lift’ of -1.1%. Option B is not possible to determine as
there is no data on the number of customers in each product segment. Similarly,
Option C is not possible to determine as there is no data on the number of
transactions in each time segment. Finally, Option D cannot be determined for
the same reasons as Option C.