MA Assignment 2 - G7

MARKETING ANALYTICS
ASSIGNMENT 2
Submitted by :
Group no 7
Name
Surbhi Arora
Ashish Tiwari
Prateek Gupta
Vijeta Gour
Chetan Dua
Arpit Vijayvergia
Suraj Mohanan
Roll no
150103186
150103046
150201056
150103202
150201029
150101029
150103184
ASSIGNMENT 2
GOAL:
To prepare a consultants report to Bencare with
recommendation for a Driving Loyalty Lift (DLL) strategy
for enhancing the companys competitive position in the
customers mind.
So we want to Predict the impact of factors on customer
loyalty.
FROM ASSIGNMENT 1 - USING 7

FACTORS
FACTOR 3: Customer trust in agent
FACTOR 5: Customer satisfaction with company
products
FACTOR 1: Customer trust in the company
FACTOR 7: Customers value assessment

FACTOR 4: Customer Loyalty (Atrributes A)
FACTOR 2: Customer Loyalty (Atrributes B)
FACTOR 6: Customer Loyalty (Atrribute C)
FACTORS IDENTIFIED FROM PAF

Using Principal Axis Factoring (PAF) instead of
Principal component Analysis (PCA), we get 7
factors:
Trust in Company Factor 1
Cognitive Loyalty Factor 2
Short Term Value for the customer Factor 3
Customers Satisfaction Factor 4
Customer Trust in Representative Factor 5
Behavioural Loyalty Factor 6
Long Term Value for the customer Factor 7
DETERMINING VARIABLES
Our aim is to determine Customers Loyalty (cognitive loyalty and behavioural loyalty)
as a function of trust, customer value and satisfaction.
Independent Variables
Trust in Company
Short Term Value
Customers Satisfaction
Trust in Company Representative
Long Term Value
Dependent Variables
Behavioural Loyalty
Cognitive aLoyalty
CONVERTING FACTORS INTO

VARIABLES
Calculations and procedure for converting factors into variables:
COMPUTE
EXECUTE.
COMPUTE
EXECUTE.
COMPUTE
EXECUTE.
COMPUTE
EXECUTE.
COMPUTE
EXECUTE.
COMPUTE
EXECUTE.
COMPUTE
EXECUTE.
Customer_Satisfaction=(inter1 + inter2 + inter3)/3.

Trust_Rep=(rep17 + rep18 + rep19 + rep20)/4.
Trust_Company=(prac17 + prac18 + prac19 + prac20)/4.
Customer_STValue=((8 - val1) + (8- val2) + (8-val3))/3.
Customer_LTValue=((8-val4) + (8-val5) + (8-val6))/3.
Beh_Loyalty=((8-loy1) + (8-loy2) + (8-loy3))/3.
Cog_Loyalty=((8-loy4) + (8-loy5) + (8-loy7))/3.
Behavioural Loyalty
CHECKING DATA FOR

ASSUMPTIONS
The error
terms data is
normally
distributed.
There exists an
almost linear
relationship
between the
variables and the
variance among
the error terms is
constant.
PARTIAL REGRESSION PLOT
The effect of adding an

additional variable to the
model. The error terms
are independent on each
other.
BEHAVIOUR LOYALTY - SUMMARY

Correlation between the observed and
predicted values of dependent variable is .
384.
55.1% of variance in the behavioural Loyalty
is explained by the independent variables.
Durbin-watson value =2.099, autocorellation
does not exist.
TheF value is significant (p<.05) which

means
that
the
predictor(independent)
variables can statistically significantly predict
the dependent variable (i.e., the regression
model is a good fit of the data).
BEHAVIOUR LOYALTY COEFFICIENTS
The impact of all the

independent variables on the
loyalty is significant. The
impact of customer long term
value is highest.
No multicollinearity
symptoms as VIF values for
all the independent variables
is around 4.
BEHAVIOUR LOYALTY - EQUATION
Regression equation
Y = 0.272 - .098* X1- .086* X2 - 0.142* X3+ 0.123* X4+ 0.* X5
Where Y = behavioral Loyalty
X1= Trust in Company Representative
X2= Customer Satisfaction
X3= Trust in Company
X4= Short Term Value for the customer
X5= Long Term Value for the customer
BEHAVIOUR LOYALTY DETERMINING OUTLIERS
There are outliers with

cooks distance a> .
040. so we remove the
outliers and then run
the model again.
BEHAVIOUR LOYALTY
AFTER REMOVING OUTLIER
does not exist.
The model without outliers is better able to
explain the variance in the dependent
variable.

means
that
the
BEHAVIOUR LOYALTY
independent variables on the
loyalty is significant. The impact
of trust in representative is the
highest followed by customer
satisfaction.
BEHAVIOUR LOYALTY EQUATION

Regression equation
Y = 0.261 + 0.153* X1+0.152* X2+0.148* X3+ 0.105* X4+ 0.134*
X5
BEHAVIOUR LOYALTY AFTER

REMOVING OUTLIER (SPLIT BY
LOCATION)
Least variance in the behavioural
Loyalty is explained by the
independent variables for holland(only
33.4%) while in case of Geramany and
USA it is higher(60.9% and 69.6%
respectively).
Durbin-watson value = nearly 2,
autocorellation does not exist.
means that the predictor(independent)
variables can statistically significantly
predict the dependent variable (i.e.,
the regression model is a good fit of
the data) in all countries.

LOCATION)
Customer Long Term Value, Trust in

representative, customer satisfaction &
Trust in company are the significant variable
in USA.
Customer Satisfaction, Trust in company,

Customer short and Long Term Value are the
significant variable in Germany
Customer Long Term Value is significant

variable in Holland.
Customer Long Term Value show signs of

multicolliearity in USA. (VIF>5)
The Company can take care of significant
variables more as compared to other variables
in each of the country.

EDUCATION LEVEL)
Education level explains almost equal
amount variances in the behavioural
Loyalty.
the data) at all education level.

EDUCATION LEVEL)
customer satisfaction & Customer Long

Term Value are the significant variable for
High school customers.
Trust in representative and company &

Customer Long Term Value are the
significant variable for some college
customers.
Trust in representative & Customer short

Term Value are the significant variable for
college customers.
Satisfaction & trust in company are the

significant variable for graduate school
customers.

for customers at different education level.

GENDER)
Lower variance in the behavioural
independent variables for female(only
47.4%) while in case of Males it is
higher(60.7%).
the data) for both male and female.

GENDER)
In case of males, all the factors are

significant.
In case of females, Trust in representative &

Customer Long Term Value are the
significant variables.
There is no multicollinearity in variables in

either of the gender,
for customers of both gender.

REMOVING OUTLIER (SPLIT BY AGE)
Almost equal variances in the behavioural
Loyalty is explained by the independent of
each age group (Least being explained by
the age group of 55+) .
predict the dependent variable (i.e., the
regression model is a good fit of the data)
for all age groups.

REMOVING OUTLIER (SPLIT BY AGE)
In case of age group 18-24, none of the

factors is significant.
In case of age group 25-34, Customer

Long Term Value is significant.
In case of age group 35-44, customer

satisfaction, Trust in represntative and
Customer Long Term Value are
significant.

satisfaction, Trust in represntative and
trust in company are significant.
There is multicollinearity in some variables

with VIF>5.
variables more as compared to other
variables for various age groups.

REMOVING OUTLIER (USING DUMMY
CODING)
Code:
RECODE loc (3=1) (ELSE=0) INTO Germany.
VARIABLE LABELS Germany 'Germany'.
EXECUTE.
RECODE loc (4=1) (ELSE=0) INTO Holland.
VARIABLE LABELS Holland 'Holland'.
EXECUTE.
RECODE educ (2=1) (ELSE=0) INTO SomeCollege.
VARIABLE LABELS SomeCollege 'SomeCollege'.
EXECUTE.
RECODE educ (3=1) (ELSE=0) INTO College.
VARIABLE LABELS College 'College'.
EXECUTE.
RECODE educ (4=1) (ELSE=0) INTO GraduateSchool.
VARIABLE LABELS GraduateSchool 'GraduateSchool'.
EXECUTE.
RECODE sex (2=1) (ELSE=0) INTO Female.

VARIABLE LABELS Female 'Female'.
EXECUTE.
RECODE age (2=1) (ELSE=0) INTO Age25to34.
VARIABLE LABELS Age25to34 'Age25to34'.
EXECUTE.
EXECUTE.
EXECUTE.
RECODE age (5=1) (ELSE=0) INTO Age55above.
VARIABLE LABELS Age55above 'Age55above'.
EXECUTE.

CODING)
DUMMY CODING:
Keeping USA as reference variable, Dummy variables for HOLLAND and
GERMANY are created
Keeping Men as reference, Dummy variables for FEMALE is created
Keeping age group of 18-24 as reference, dummy variables AGE25TO34,
AGE35TO44, AGE45TO54 & AGE55ABOVE are created
Keeping High School students as reference, dummy variables SOMECOLLEGE,
COLLEGE and GRADUATESCHOOL are created.

CODING)
is explained by the independent variables
which is almost equal to variance explained
without the use of dummy variables(56.7 %).
Durbin-watson value = 2, autocorellation does
not exist.
means
that
the
model is a good fit of the data).c

CODING)
Customer short and long term value,

trust in company, trust in
representative and customer
satisfaction are the most significant
factors.
Out of the dummy

variables(categorical variabes added),
none of the variable has a significant
impact on the behavioral loyalty and
thus they are not as important as the
variables.
BEHAVIOUR LOYALTY EQUATION

Regression equation after adding categorial variable:
Y = 0.451 + 0.146* X1+0.147* X2+0.150* X3+ 0.099* X4+ 0.153* X5 0.173*C1+ 0.056*C2 + 0.129*C3 + 0.137*C4 +0.015*C5 + 0.104*C6 0.247*C7 0.249*C8 + 0.324*C9 - 0.85*C10.
Where Y = Behavioural Loyalty , X1= Customer Satisfaction, X2= Trust in Reprensentative,
X3= Trust in Company, X4= Short Term Value, X5= Long Term Value, C1= germany, C2=
Holland, C3= somecollege, C4 = college , C5=graduateschool, C6= female, C7=
age25to34, C8 = age35to44, C9 = age45to54, C10 = age55above
BEHAVIOUR LOYALTY AFTER REMOVING

OUTLIER (USING DUMMY CODING, ROBUST BY
HOLLAND)
In HOLLAND:
Out of the dummy

variables(categorical variabes
added), none of the variable has a
significant impact on the
behavioral loyalty in Holland.
The only independent variable

significant in Holland is the
customer long tem value. So, the
company can focus more on
concentrate more on customer
long tem value to drive
behavioural loyalty.

GERMANY)
In GERMANY:
Out of the dummy

behavioral loyalty in Germany.
The independent variable

significant in Germany are the
customer satisfaction, trust in
company and customer short term
value. So, the company can focus
more on concentrate more these
factors to drive behavioural
loyalty in Germany.

USA)
In USA:
Out of the dummy

behavioral loyalty in USA.

significant in USA are the
representative, trust in company
and customer long term value. So,
the company can focus more on
concentrate more these factors to
drive behavioural loyalty in USA.
Congintive Loyalty
CHECKING FOR ASSUMPTIONS
The error
terms data is
normally
distributed.
There exists an
almost linear
relationship
between the
variables and the
variance among
the error terms is
constant.
PARTIAL REGRESSION PLOTS
The effect of adding an

additional variable to the
model. The error terms
are independent on each
other.
CONGINTIVE LOYALTY - SUMMARY

Correlation between the observed and
predicted values of dependent variable is .
384.
38.1% of variance in the behavioural
Loyalty is explained by the independent
variables.
Durbin-watson value =2.099,
regression model is a good fit of the data).
COGNITIVE LOYALTY - COEFFICIENTS

independent variables on
the loyalty is significant.
The impact of by customer
long term value in
representative the highest
followed by Trust in
company.
P value of Trust_Rep is .
060>.050(significance
level) which means
Trust_rep is not significant
Customer loyalty is slightly less

dependent on trust_rep in
compare to other variables
No multicollinearity
symptoms as VIF values for
all the independent
variables is around 4.
COGNITIVE LOYALTY - EQUATION

Regression equation
Y = 0.019 + 0.079* X1+0.086* X2+0.114* X3+ 0.105* X4+ 0.177*
X5
COGNITIVE LOYALTY - DETERMINING

OUTLIERS
There are outliers with

cooks distance a> .
040. so we remove the
outliers and then run
the model again.
COGNITIVE LOYALTY AFTER

REMOVING OUTLIERS
does not exist.
The model without outliers is better able to
explain the variance in the dependent
variable.

means
that
the

REMOVING OUTLIERS
The impact of all the independent
variables on the loyalty is significant
except Trust in representative. P value
of Trust_rep is .087>.05 (significance
level) which shows even after
removing the outlier Trust_rep remains
insignificant
Cognitive Loyalty has low impact of
trust in representative in compare to
other variables
Significance of all other variables has
improved except Trust_rep after
removing outliers
The impact of customer long term
value in representative is the highest
followed by trust in company.
COGNITIVE LOYALTY EQUATION

AFTER REMOVING OUTLIERS
Regression equation
Y = -.003 + 0.072* X1+0.089* X2+0.135* X3+ 0.106* X4+ 0.163*
X5

LOCATION)
Least variance in the cognitive Loyalty
is explained by the independent
variables for Holland (only 27.2%)
while in case of Geramany and USA it
is higher(39.1% and 47.2%
respectively).
the data) in all countries.

LOCATION)
Customer Long Term Value is

significant variable in USA.
Customer Satisfaction is significant

variable in Germany
Trust in representative is significant

variable in Holland.
Customer Long Term Value show signs

of multicolliearity in USA. (VIF>5)
The Company can take care of
significant variables more as compared
to other variables in each of the
country.

EDUCATION LEVEL)
Highest variance is explained by high
school in cognitive loyalty.
at all education level.

EDUCATION LEVEL)
Trust in the company, Customer short

term value, Customer Long Term Value
are the significant variable for High
school customers.
Trust in company & Customer Short Term

Value are the significant variable for
some college customers.
No significant variable for college

customers.
No significant variable for graduate

school customers.

variables for customers at different
education level.

GENDER)
Lower variance in the Cognitive Loyalty
is explained by the independent
variables for female(only 37.2%) while
in case of Males it is higher(39.7%).
the data) for both male and female.

GENDER)
In case of males, customer satisfaction,

and short term value are significant.
In case of females, Customer Long Term

Value is the significant variables.
There is no multicollinearity in variables in

either of the gender,
variables for customers of both gender.

REMOVING OUTLIER (SPLIT BY AGE
GROUP)
Highest variance is explained by the age
group of 18-24 yrs and Least being
explained by the age group of 55+ .
for all age groups.

REMOVING OUTLIER (SPLIT BY AGE
GROUP)
In case of age group 18-24, none of the

factors is significant.
In case of age group 25-34, Customer Long

Term Value is significant.

satisfaction and Customer Long Term Value
are significant.
In case of age group 45-54, trust in

representative is significant.
In case of age group 55+, trust in company

and customer short term value are
significant.
There is multicollinearity in some variables

with VIF>5.
for various age groups.

CODING)
Code:
RECODE loc (3=1) (ELSE=0) INTO Germany.
VARIABLE LABELS Germany 'Germany'.
EXECUTE.
RECODE loc (4=1) (ELSE=0) INTO Holland.
VARIABLE LABELS Holland 'Holland'.
EXECUTE.
RECODE educ (2=1) (ELSE=0) INTO SomeCollege.
VARIABLE LABELS SomeCollege 'SomeCollege'.
EXECUTE.
RECODE educ (3=1) (ELSE=0) INTO College.
VARIABLE LABELS College 'College'.
EXECUTE.
RECODE educ (4=1) (ELSE=0) INTO GraduateSchool.
VARIABLE LABELS GraduateSchool 'GraduateSchool'.
EXECUTE.
RECODE sex (2=1)

VARIABLE LABELS
EXECUTE.
RECODE age (2=1)
VARIABLE LABELS
EXECUTE.
RECODE age (3=1)
VARIABLE LABELS
EXECUTE.
RECODE age (4=1)
VARIABLE LABELS
EXECUTE.
RECODE age (5=1)
VARIABLE LABELS
EXECUTE.
(ELSE=0) INTO Female.

Female 'Female'.
(ELSE=0) INTO Age25to34.
Age25to34 'Age25to34'.
(ELSE=0) INTO Age55above.
Age55above 'Age55above'.

CODING)
DUMMY CODING:
Keeping USA as reference variable, Dummy variables for HOLLAND and
GERMANY are created
Keeping Men as reference, Dummy variables for FEMALE is created
Keeping age group of 18-24 as reference, dummy variables AGE25TO34,
AGE35TO44, AGE45TO54 & AGE55ABOVE are created
Keeping High School students as reference, dummy variables SOMECOLLEGE,
COLLEGE and GRADUATESCHOOL are created

CODING)
40.2% of variance in the behavioural
independent variables which shows a
increase compared to variance
explained without the use of dummy
variables(38.1%).
Durbin-watson value = 2,
TheF value is significant (p<.05)
which
means
that
the
predictor(independent) variables can
statistically significantly predict the
dependent
variable
(i.e.,
the
regression model is a good fit of the
data).

CODING)
Customer short term and long

term value, trust in company,
and customer satisfaction are
the most significant factors.
Out of the dummy

added), only graduate school
has a significant impact on the
cognitive loyalty.
COGNITIVE LOYALTY EQUATION AFTER

CODING)
Regression equation after adding categorial variable:
Y = 0.349 + 0.084* X1+0.070* X2+0.135* X3+ 0.112* X4+ 0.157* X5 + 0.012*C10.083*C2 - 0.032*C3 - 0.181*C4 - 0.248*C5 - 0.032*C6 - 0.024*C7 0.225*C8 0.191*C9 - 0.129*C10.
Where Y = Behavioural Loyalty , X1= Customer Satisfaction, X2= Trust in Reprensentative, X3= Trust in
Company, X4= Short Term Value, X5= Long Term Value, C1= germany, C2= Holland, C3= somecollege, C4
= college , C5=graduateschool, C6= female, C7= age25to34, C8 = age35to44, C9 = age45to54, C10 =
age55above
COGNITIVE LOYALTY AFTER REMOVING

OUTLIER (USING DUMMY CODING, ROBUST,
HOLLAND)
In HOLLAND:
Out of the dummy

added), none of the variable
has a significant impact on the
behavioral loyalty in Holland.
The only independent variable

significant in Holland is the
trust in representative. So, the
company can focus more on
concentrate more on the trust
in representative to drive
cognitive loyalty.

GERMANY)
In GERMANY:
Out of the dummy

added), graduateschool and
college has a significant impact on
the Cognitive loyalty in Germany.

significant in Germany are the
company and customer long term
value. So, the company can focus
more on concentrate more these
factors to drive cognitive loyalty in
Germany.

USA)
In USA:
Out of the dummy

significant impact on the cognitive
loyalty in USA.

significant in USA is the customer
Long term value. So, the company
can focus more on concentrate
more customer Long term value to
drive cognitive loyalty in USA.
RECOMMENDATION
In USA Long term value drives both behavioural and cognitive loyalty while satisfaction and trust are other
major drivers of loyalty, Short term value has the least impact; In Germany satisfaction level is the most
important factor followed byvalue and trust; and in Holland trust is the most important factor followed
bylong term value. So in these regions different factors can be improved to improve the loyalty.
It is observed that as age increases the focus of customer shift from value and satisfaction to trust to drive
loyalty. For younger customer any of the factors do not have any significant impact, so there is relatively
less impact on loyalty of younger customer by improving any of the factors. Trust and satisfaction seem to
be the most significant factors.
Females, generally look for long term value which drives their loyalty to a company while men are seem to
be affected by almost all factors which means it is easier for the company to drive loyalty(both cognitive
and behavioural) among females than males.
THANK YOU

MA Assignment 2 - G7

Hochgeladen von

Dokumentinformationen

Originaltitel

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

MA Assignment 2 - G7

Hochgeladen von

Copyright:

Verfügbare Formate

MARKETING ANALYTICS

FROM ASSIGNMENT 1 - USING 7

FACTOR 7: Customers value assessment

FACTORS IDENTIFIED FROM PAF

CONVERTING FACTORS INTO

Customer_Satisfaction=(inter1 + inter2 + inter3)/3.

CHECKING DATA FOR

PARTIAL REGRESSION PLOT

The effect of adding an

BEHAVIOUR LOYALTY - SUMMARY

TheF value is significant (p<.05) which

BEHAVIOUR LOYALTY COEFFICIENTS

The impact of all the

BEHAVIOUR LOYALTY - EQUATION

BEHAVIOUR LOYALTY DETERMINING OUTLIERS

There are outliers with

TheF value is significant (p<.05) which

BEHAVIOUR LOYALTY EQUATION

BEHAVIOUR LOYALTY AFTER

BEHAVIOUR LOYALTY AFTER

Customer Long Term Value, Trust in

Customer Satisfaction, Trust in company,

Customer Long Term Value is significant

Customer Long Term Value show signs of

BEHAVIOUR LOYALTY AFTER

BEHAVIOUR LOYALTY AFTER

customer satisfaction & Customer Long

Trust in representative and company &

Trust in representative & Customer short

Satisfaction & trust in company are the

The Company can take care of significant

BEHAVIOUR LOYALTY AFTER

BEHAVIOUR LOYALTY AFTER

In case of males, all the factors are

In case of females, Trust in representative &

There is no multicollinearity in variables in

BEHAVIOUR LOYALTY AFTER

BEHAVIOUR LOYALTY AFTER

In case of age group 18-24, none of the

In case of age group 25-34, Customer

In case of age group 35-44, customer

In case of age group 45-54, customer

There is multicollinearity in some variables

BEHAVIOUR LOYALTY AFTER

RECODE sex (2=1) (ELSE=0) INTO Female.

BEHAVIOUR LOYALTY AFTER

BEHAVIOUR LOYALTY AFTER

BEHAVIOUR LOYALTY AFTER

Customer short and long term value,

Out of the dummy

BEHAVIOUR LOYALTY EQUATION

BEHAVIOUR LOYALTY AFTER REMOVING

Out of the dummy

The only independent variable

BEHAVIOUR LOYALTY AFTER REMOVING

Out of the dummy

The independent variable

BEHAVIOUR LOYALTY AFTER REMOVING

Out of the dummy

The independent variable

CHECKING FOR ASSUMPTIONS

PARTIAL REGRESSION PLOTS

The effect of adding an