• Carolina Duque Chopitea

Web Analytics at Quality Alloys, Inc: Marketing their Business and Increasing Sales | Data Science R

Full report here | R code here



Executive Summary


Company background


Quality Alloys (QA) is a small to medium size distributor that provides different types of alloys to various manufacturers. QA’s major customers are small companies that need specific alloys for various operations. These customers tend not to inventory, they typically purchase what they need for a specific job, making it hard for QA to predict future purchases. QA is a well stablished company in its niche market: it has expertise in suppling different grade of alloys; it sells in small quantities; cuts materials for user-specified size:, and QA ships items in stock the same or next day, making them a go-to solution for small companies which may find it difficult in finding the right supplier for their needs and often cannot buy directly from the mills.


Currently, QA markets its products through direct mail, advertising in trade magazines and listing on web portals. In 2008, to extend its marketing reach the company established a website. The website aims at driving new sales, make products and contact information available, and add legitimacy to QA’s brand. The website is also seen as a tool to reach out to more customers in the US, Europe and Asia. The website does not have a “shopping cart” but it allows for potential customers to submit inquiries, this often makes it hard to determine the value of the website. In addition, in an attempt to increase sales, the company invested $25k in brochures, providing an overview of the company’s products and services that were distributed to potential customers in mid-December.


Currently, most people have been reaching their website through Internet Explorer and using google as their main search engine. The top referring site is ‘googleads.g.doubleclick.net’ which tops GlobalSpec and ThomasNet.com, industrial product web portals where QA have listings. As well, most of their visits are from people located in South America followed by North America.


Business problem


QA needs support in measuring the value added of their website. In other words, QA wants to understand if the investment in the website is yielding greater revenues and increasing visibility of the company.


QA provided data about their website, financials and demographics. This data was used to understand the performance of the website as an advertising channel and driver of sales. In turn the insight derived from the analysis can help determine which marketing channels are worth promoting, and which need restructuring or should be abandoned. Therefore, the goal of this analysis is to provide recommendations as how they might best market their business with an aim towards improving sales.


At first glance seems that potential customers are visiting their website. From May 25, 2008 to August 29, 2009 an average of 150 people visited their website daily. Given that they are a small to medium size company, the website seems to be yielding some interest. It was also observed that the promotional period also drove traffic to the website. However, after analyzing the data provided by QA, it can be determining that even as it appears that the website is sparkling interest, visits are not translating into revenue (please see Figure A and Raw Analysis section for further details). Currently, sales are mainly driven by pounds sold and visit to the website seem to not have an impact on sales. As well, the analysis demonstrated that the increased in visits during the promotional period did not directly translated into revenue (please see Analysis section for further details).


Recommendations


For detailed explanation of the recommendation please see full report.

1) No more resources should be spent printing and mailing brochures.

2) An A/B test that includes a “shopping cart” can be used to test if a direct check out can increase sales.

3) The investment currently done in referring sites and search engines should be preserved, particularly for refering stes like GlobalSpec and ThomasNet, sites that particularly target customers looking for alloys.

4) To target the Asian market (as desired), QA should advertise on search engines such as Baidu or other search engines that are used in the region, as currently most searches are done from engines not used in the region.

5) Engage in an online/email promotional campaign particularly targeting Asia customers to increase web traffic and sales from this region.

6) Inquiries, which are not happening through the website, are not resulting in sales. This means that the sales team are not closing sales after a potential customer has reach out. Offering new training for the sales team will be imperative for increasing sales.



Figure A: There appears to be no linear relationship between revenues and website visits.

Carolina Duque Chopitea