MSIN0041 Marketing Science
2023/24
IMPORTANT:
Write the question number and your answer to the exam answer document. There are FIVE (5) compulsory questions in total. Each question is worth TWENTY (20) marks. Candidates should attempt all questions. Please keep your answers concise by keeping your answers at most 300 words per question. You usually need significantly less than the limit for answering each question.
Question 1
Suppose you are the head of the pricing department of an online fashion retailer. Explain and discuss how you could formulate your personalized pricing strategy for an existing customer. To determine your strategy, what data do you need? Discuss the pros and cons of your approach.
[20 marks]
Question 2
Suppose you work for a home appliance company that plays a dominant role in the market. Your company has been paying Google Ads for displaying your ads promoting your company's products on a major news publisher: whenever a visitor to the news publisher's website clicks on your ad, your company pays a small fee to Google for displaying your ads.
Your company has invested in the necessary infrastructure to track the browsing and consumption behaviour of each prospective customer that clicks on your ads, including the amount of spending attributed to that customer. Suppose you are the chief financial officer for the company with all the fiscal and financial information about the company at hand. You want to know whether the marketing department's online advertising expense is worthwhile.
(a) Based on the available information, what analysis could you do to answer this question?
[10 marks]
(b) Is your analysis biased? If it is biased, in what direction is it biased? Remember to explain your answer.
[10 marks]
Question 3
An online streaming company is trying to improve its customer retention. The company's analytics department recently developed a new recommendation system that purportedly improves viewer engagement. To test the effectiveness of this new system, the company applied the system to a cohort of new subscribers and monitors each user's engagement. To benchmark the new system and improve the statistical power, the company also collected the relevant metric from a larger pool of existing subscribers with a tenure of at least 6 months.
What is the individual metric you would use to measure for engagement? How would you evaluate the new system based on the available data? Discuss the pros and cons of the approach taken by the company.
[20 marks]
Question 4
Suppose you work for a footwear company that specializes in sports trainers and has with its own online retail website. Discuss how you could use customer reviews to help with your conjoint analysis.
[20 marks]
Question 5
Discuss how the choice between second-degree and third-degree price discrimination could affect a company's product line design.
(a) What is the profit comparison between the two types of price discrimination?
[10 marks]
(b) Do you always observe a company choose the type of price discrimination with superior predicted profits in the models learned in the lectures? If not, explain why the observation could differ from some theoretical predictions in thlectres.
[10 marks]