Our client is a city guide discovery application that brings users and merchants together through geo-located offers. The objective of this research is to examine merchant performance via redemption rates. The results are displayed using funnel plots, a useful tool for displaying unbiased information on performance outcomes when comparing entities within a group. The funnel plot shows a high amount of overdispersion where there is a large number of outlying merchants. By further analyzing under-performing and over-performing merchants separately, the analysis shows that there is also a large variation in outlying redemption rates within each group. To investigate the underlying reasons, we conducted exploratory data analysis. Merchant and product category are shown to be significant contributors to a merchant’s redemption rate. These findings will help our client set benchmarks for individual merchants and develop interventions to help merchants increase their performance.
Business Motivations and Objectives
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