Bayesian Analysis
Promotional Event
Dig, LLC is planning two promotional events to launch its new mobile application. First, host a launch party at Top Golf Jacksonville to present and promote the product and build relationships within the community. Invitations will go out to all real estate professional in the Northeast Florida, Orlando Regional and Osceola County market. Second, offer a lottery contest for all the customers who download the application and create an account in the first 90 days of the launch. Dig, LLC, will invite customers via a targeted Facebook advertisements and direct mailer. On January 1, 2018, to celebrate the new year, Dig, LLC will select twenty winners to give away one year of free premium subscription service. The price is valued at $360.00. The promotional events will serve as the launching pad for notifying and educating real estate professionals about the application and its benefits.
Target Customers
Figure 1: Launch Attendees and Subscribers
Dig, LLC’s investment in these promotional events are estimated at $10,000. It is a steep investment for a new startup company but Dig, LLC believes in the value of quick and explosive brand awareness to be able to attract as many customers as possible. Furthermore, Dig, LLC will be able to gain feedback from these new users to improve the application’s features or user interface (UI), get new feature requests, and maybe even pivot from an existing capability to something different or unique. Dig, LLC’s goal is to serve real estate professionals with a powerful tool to increase and accelerate their knowledge about the real estate market.
Selected Sampling
From the list of customers collected from the promotional events, the male customers represent the larger population versus the female counterpart at 1571 and 1008 respectively - shown in Figure 1. Dig, LLC’s legal department has some concern that the females have a disadvantage of getting selected for the contest. They want to know what would be the probability of randomly selecting a female. By using the marginal probability equation of P (F), as F for female as the selection, it resulted in .39 or 39.08%. Dig, LLC’s marketing team also provided additional information to illustrate further the chances of female NEFL Agents and Brokers as well females in Orlando and Osceola real estate professionals shown in Figure 2.
Figure 2: Female Selection Probabilities
Lottery Analysis
Dig, LLC’s executive leadership has decided to award one winner from the promotional event a trip to Hawaii. Each of the customers that signed up (created an account) during the promotional event will have a chance to win. Their account will count as an entry to this contest. To ensure fairness with no possibilities of discrimination, Dig, LLC announced the contest after the 90-day promotional event on the day of awarding the twenty winners - January 1, 2018. This strategy prevented customers in creating multiple accounts to increase their chances of winning. Dig, LLC’s marketing team also provided the legal team with the information shown in Figure 3 to illustrate which group will have the highest chance of winning the price. Figure 3 reflects that NEFL Male Agents has the highest probability of winning because of higher participation.
Figure 3: Random Selection Probabilities
Bayesian Analysis
Figure 4: Probability Tree and Table - Marketing Campaign
With a limited budget as a startup company, Dig, LLC’s marketing wants to use every dollar as efficiently as possible to increase subscription. They asked the BI team to determine if hosting a launch party provides additional value to signing-up new real estate professional given that all participants learned about the event via the Facebook Ad. Additionally, the data gathered from the NEFL, Orlando, and Osceola promotional activities will be in consideration.
Based on the BI team’s analysis, there’s a higher probability that a launch party is not required when expanding to other Real Estate Regions. Figure 4 shows that there is a 70% probability that customers will sign-up without attending an event versus the 29% that participated in a hosted launch party. This information will save Dig, LLC additional expense when launching their service to other areas.
Expansion Recommendation
Based on the analysis performed previously for the marketing team, the BI team is recommending to expand Dig, LLC’s service to other cities in Florida - specifically Tampa and Miami area for its second phase of expansion. According to Martin (2016), Florida added nearly 29,000 new real estate agents in 2015, the most in nine years. She further claimed that the dramatic increase gives Florida a total of 221,000 real estate agents. Those numbers represent enormous opportunity for Dig, LLC to cultivate and leverage.
References
Martin, S. (2016 Feb 3). Florida added nearly 29,000 new real estate agents in 2015, the most in nine years. Retrieved from http://www.tampabay.com/news/business/realestate/florida-added-nearly-29000-new-real-estate-agents-in-2015-the-most-in-nine/2263962