Wharton Business Analytics Capstone Project
- 1. Business Analytics Capstone Framework for Strategy Divyanshi Loomba 12/24/17
- 3. Problem Statement– Describe the Problem Adblockers present to GYF The problem that GYF faces with ad blocking services is the potential of not being able to provide their users with free access to their platform. The obvious cause to this problem is the loss of the number of companies willing to pay GYF to advertise on their platform especially if more and more users visiting GYF are using ad blockers. This is understandable from the point of view of the companies trying to advertise their business. If users are going to block all ads, then the company will be foolish to keep paying GYF to advertise as the advertisement does not even reach most of the users. On the other hand, after reading the assigned articles about Google and Yahoo’s thoughts on ad blocking and what the thoughts are on Apple giving ad blocking apps the ability to be used, it’s not always a negative to use ad blocking services. The reasoning behind it is that it may better the user experience in a way where advertisements that are actually meant to track and use user information for data mining purposes can be avoided providing users with more privacy. Along with that, some websites may load faster and use less data without as many or any advertisements on that particular website. It can definitely better the user experience but at what cost? Would they rather have advertisements on free websites or not have advertisements and potentially lose their favorite website/have to pay to access the contents. To better understand what the users want, the data analytics team needs to perform causal research and use focus groups, social media and mobile data analytics for quantitative purposes.
- 4. Problem Statement– Application Exercise 1 – Research Methods and Tools (Optional) • To answer the first question, I would consider using causal research methods as we have clearly defined the problem of the effect ad blockers have on free websites, companies who advertise on free websites and the user themselves. Having already defined the problem gives us the ability to ask the right questions like will there be less free websites available as the number of ad block users increases? • I would highly recommend focus groups since we get clear cut and genuine answers on the spot. Along with that we should also use social media data and mobile data as that will show us how many people are using ad blocking services and if they are enabling it more for certain websites as compared to another.
- 5. Strategy
- 6. Strategy Describe your proposed strategy After reading all the required material, I believe that companies like Google, Yahoo, Bing, GYF etc. are in a arena where they need to be adaptive and come up with creative solutions to their Adblocking problems. The only way to find a solution is to experiment the different potential ways they can satisfy their clients expectations and experiences as well as still be able to advertise on their platform. There are a few strategies that I think would have to be experimented with before finding the “solution” to the big Adblocking dilemma. But before we define the strategies, I believe that I will hire Peggy Prospect as the Senior Associate Director of Digital Advertising Strategy. My reason for hiring her over Carrie Candidate is as follows: • She has experience in dealing with a lot of the pressures that we at GYF face with Adblocking with her previous employer. • She exhibited skills that would make her an exceptional team player. • At the interview, Peggy had a complete idea of what was to be expected of her if she was to accept this job position. • I find that being focused on short-term is not necessarily a negative as in an industry that is constantly changing, short-term ideas are more effective than thinking too much in the long-term. Now that we have hired Peggy, these are some of the strategies I would like to experiment along with how they work and how viable these strategies are: 1. The first strategy would be to “Go Native”. To accomplish this we would only allow advertisements that are relevant to the material on that particular website. For example: If someone is reading a Lifestyle blog then the advertisements can be from companies that sell furniture, household items, etc. This improves user experience and makes the website less disruptive and more relevant to the user. This strategy should not be hard to implement as a lot of websites are already using this strategy. 2. The second strategy entails listening to the users directly. We need to figure out straight from the user whether they want an experience with no ads at all or minimal/relevant advertisements. This can be done by organizing a short survey sent to the users email or conducting focus groups which will produce genuine answers from the users themselves. The online survey can be tricky if there is no way for the website to collect emails and they cannot predict if someone will reply to the survey or not. 3. The third strategy could be to simply just pay AdBlock so that none of the advertisements on our GYF platform are blocked. This could be a form of bribe but if it does not reduce our customer acquisition, then there is no harm done. The obstacle to this is the cost of paying Adblock to exclude us from it’s effects.
- 7. Strategy Application Exercise 2 – Hiring a Team Leader (Optional) Even though both the candidates were highly qualified I have decided to hire Peggy Prospect. My reason for hiring her over Carrie Candidate is as follows: • She has experience in dealing with a lot of the pressures that we at GYF face with Adblocking with her previous employer. • She exhibited skills that would make her an exceptional team player. • At the interview, Peggy had a complete idea of what was to be expected of her if she was to accept this job position. • I find that being focused on short-term is not necessarily a negative as in an industry that is constantly changing, short-term ideas are more effective than thinking too much in the long-term. The reasons I did not hire Carrie is as follows: • Even though she graduated from a top 10 school, she lacked the experience we need for this position. • She scored higher than Peggy on the cognitive ability test and in some situations that is a deal breaker for some employers. But in our case, Peggy’s experience was more valued. • Another negative was that she did not demonstrate as many skills for team work as Peggy. It is important for everyone on the DATA team to work together and communicate as one missed detail can cost us a lot in potential revenue.
- 9. Effects Describe the anticipated effects of your strategy Effects of Strategy: 1. Customers: • If we were to implement strategy number 1, customers will have a much better experience while using our platform as we will design the pages in a way where advertisements are relevant to the material on the pages they are visiting. • For strategy 2, some customers may not enjoy getting emails asking them to answer online surveys but if they were selected for a focus group then they could be compensated for the their time. For example: $75 for an hour long focus group. • Lastly, if we were to implement strategy 3, we may lose some users depending on if thy were using Adblock services in the first place to block all advertisements. 2. Internal Organization: • Strategy 1 would require our Data team to collaborate with our IT department so we can produces codes that will put the right advertisements on the right pages and help better the platform. • To implement strategy 2, we would require extra personnel to conduct focus groups and create our online surveys that we would send through the users email. We could also hire an outside firm to conduct our focus groups for us. • For strategy 3, our team would have to asses if the number of visits to our platforms have decreased and if so, this may not be the best strategy for us. We need to asses how many users are actually using Adblock. This is because if only a small population of users is using Adblock, then we may not need to pay Adblock just for a small majority of users. 3. Revenue: • Strategy 1 – Should increase revenue if more advertisers want to advertise if there is an increase in customer acquisition due to better user experience. • Strategy 2 – Will incur costs as hiring extra personnel or hiring an outside firm will cost us money. • Strategy 3 - This will also cost us as we would be paying Adblock for their services.
- 10. Effects Application Exercise 3 – Designing a Deterministic Optimization Model 1. Optimization Model Scenario: • Our budget is equal to the Internal plan + the External plan which is ≤ 65k • Hard Skills Internal Expenditure*.2 + Hard Skills External Expenditure*.7 ≥ 20k • Soft Skills Internal Expenditure*.6 + Soft Skills External Expenditure*.4 ≥ 12k • Hard Skill Internal Expenditure*.2 + Soft Skill Internal Expenditure*.6 ≥ (Hard Skill External Expenditure *.7 + Soft Skill External Expenditure*.4)*60% • All numbers are required to be an integer and greater than 0 2.
- 11. Measurement Describe the anticipated effects of your strategy and how you will measure them Measuring the Effects: 1. Customers: • Out of the 3 potential strategies, we need to measure which one works best in terms of customer acquisition and retention along with it being cost effective. This can be measured by collecting data and analyzing whether we are having higher traffic or lower traffic depending on the different strategies. If our costs are too high and there is not much increase in traffic/peaked interest in advertisements, then we need to find a new strategy. • Collecting data from online surveys and focus group meetings can really help us understand how the users feel about advertisements and if they prefer good/relevant advertisements, to no advertisements at all. • By tracking the users activities, we can learn what they like and dislike hence helping us improve their experience on our GYF platform. 2. Revenue: • To implement the strategies there is a need to collaborate with other departments in the company. We would need to keep track of all the extra money that we will be spending. • The company will need to decide whether we want to hire extra personnel to conduct surveys/focus groups or hire an outside company to do it for us. The cost to hire and train new personnel and to organize and conduct focus groups may cost us more than to just hire an outside company. • We would need to keep track of all the extra spending on marketing to let our users know that we are working on improving their experience on our platform. 3. Internal Organization: • Make sure that the plan is explained thoroughly and clearly through chain of command. • Conduct employee surveys on how they feel about the new strategies and open a portal where employees can submit ideas on different strategies that we should consider. • To better understand how much work is going into these strategies, we need to measure the amount of time spent on employee discussions, developing ideas and plans and implementation.
- 12. Measurement Application Exercise 4 – Identifying Key Drivers 1. Hypothesis: Improving customer experience on our platform through our discussed strategies, will lead to more online traffic to our platform and hence attract more advertisers to advertise on our platform. 2. One Key Driver and How to Measure it: Customer satisfaction is one of the key drivers. We measure customer satisfaction through collecting and analyzing their data to see what attracts them and what does not. Focus groups gives us valuable insight into what the user preferences are in regard to advertisements. 3. Verifying the linkage: If we are gaining more users and our users are exploring more of our platform, then we can say that it is leading to more satisfied customers. They may be enjoying the advertisements on their pages as they are now more relevant to their interests. Seeing that they are getting more hits on their advertisements through our website, they may want to continue advertising through our website or we may attract more advertisers hence increasing our revenue.