Online Ordering Analysis

Content
-Overview
-Performance analysis
-Customer behavior analysis
-Cohort analysis

Overview
The dataset includes the transactional data of several stores from May 2016 to April 2018.
The orders table consists of columns like order submitted date, customer index, delivery
date and total amount. The customers table contains the customer information like email,
gender, age. The purpose of this report is to do analysis on the overall performace of these
stores’ online selling and the customer behaviors.

Performance analysis
To know the performance of merchant 4 in terms of its revenue, orders, I mainly used bar
charts with the percentage change between each month. And to look at this problem from
different perspectives, I used three metrics for comparing mechant 4’s performances over
each month:

basketSize_perOrder(the average basket size of orders in a month),

basketSize_overtime(the sum of all orders’ basket size in a month),
basketSize_orderCount(the total number of orders in a month).

Except these metrics, I also looked at merchant 4’s performance in different categories:

Pickup orders / Delivery orders

Advanced orders/ Normal orders (non-advanced orders)

-Outliers
 Figure 1

From Figure 1, there are outliers for merchant 4 on 2016/11.

Figure 2

After checking the raw data, there are 5 records with barket_size 99999 which is ridiculous.
To ensure the authenticity of the report, I excluded these five records when doing the
analysis.

-Analysis

All orders
Figure 3. Basket size per order for a month

Figure 4. Basket size sum for a month

 Figure 5. Number of orders in a month

From Figure 3, we can find that the average basketsize for all the orders didn’t have a clear
upper trend from 2016/10 to 2017/06. However, there is a clear increase in 2017-01. The
bar chart of sum of basket size per month and number of orders per month almost have the
same shape. There is a obvious increasing trend from 2017/1 to 2017/6.

Pickup & Delivery

Figure 6. Pickup & Delivery Basket size per order for a month
 Figure 7. Pickup & Delivery Basket size sum for a month

Figure 8. Pickup & Delivery Number of orders in a month

Advanced & Normal

Figure 9. Advanced & Normal Basket size per order for a month

Figure 10. Advanced & Normal Basket size sum for a month
 Figure 11. Advanced & Normal Number of orders in a month

From the figures, we can see that the performance of both pickup/deliver and
advance/normal orders follow the similar trend with all orders’. But one insight we get from
the charts is that alghouth normal orders’ values basket size per order in each month are
close to that of advanced orders, normal orders’ numbers of orders in each month are
significantly lower than that of advanced orders.

Customer behavior analysis

-Simple Compare

Figure 12. total_noOfOrders_gender

 Figure 13. BasketSize_gender_avg

Figure 14. BasketSize_gender_sum

From Figure 13 14 15, we can see that average basket size of male customers is slightly
higher than that of female customers. Whereas female customers surpass male customers
significantly in terms of total number of order and total basket size.
Figure 15. total_noOfOrders_age

Figure 16. BasketSize_age_avg

Figure 17. BasketSize_age_sum

From Figure 14 15 16, we can conclude that customers between 18-44 accounts for most of
the consumption. From this insight, I suggest merchants can do more marketing campaign
for these three age group customers.

Figure 18. total_noOfOrders_CorporateType(0 for individual, 1 for corporate)

Figure 19. BasketSize_CorporateType_avg(0 for individual, 1 for corporate)

 Figure 20. BasketSize_CorporateType_sum(0 for individual, 1 for corporate)

From Figure 18 19 20, the corporate type of customers tend to order more food per order
but the their total number of orders are less that the normal customers.

-Grid of barcharts

Figure 21. basket size per order, grid bar chart (gender, corporatetype-
column, age-row)
From Figure 21, we find that male the average basket size of orders for customers in 35-44
and 55-64 are far less than female customers’. And superisely, male customers outperform
female customers in other age groups.

-RFM Score

RFM stands for recency, monetary, frequency and it’s a metirc that help the businenss
owbers to put their customers into different groups.

Figure 21. RFM score (From RFM_results.xlsx)

After calculating the RFM score for each customers, I was able to get the group of the most
important customers (individuals who contribute more to the revenue).

Monthly lifetime revenue cohort

analysis of three bakery merchats
Cohort analysis is important for business owners to understand their businesses’ health and
the loyalty of their customers. In this part, I use the cohort analysis methods to analyze three
bakery stores’ monthly lifetime revenue regarding their ordering data from 2016.01 to
2018.09.

To calculate the monthly lifetime revenue, I used the definition from Edward Gotham: “CLV
is the value a customer contributes to your business over their entire lifetime at your
company”. The specific formula is:

sum of basket_size of each order in the month / number of customers in a month

Also, I used the signup month of each user as the cohort group.

Figure 13

From the Figure 13, we can know that customers who signed up in ‘2017-04’ are the most
sticky group. At its eighth cohort period, the CLV of ‘2017-04’ group surged from 128.2 to
307.6 and has more cohort period with high CLV values since then. Another finding is that
usually the CLV value will fall down for several consecutive months after users signed up.
Compared to the other two bakery stores, bakery store 1’s customers are more likely to
keep ordering from it after 1 or 2 month of using store 1’s online ordering service.
 Figure 14

For bakery store 3, customers who signed up between 2014-09 to 2016-06 all discarded
using barkery store 3’s ordering service after serveral months. From that, maybe we can
conclude that bakery store 3 didn’t do well in marketing at its early days of adopting online
ordering solution. However, after 2016-05, we can see that users use bakery store 3’s
service more consistently even after 10 months of usage. Another insight about bakery store
3 is that it has more CLV value sudden rises(CLV value increased a lot from its perivous
month) and its average CLV value is higher than the other two bakery stores.
 Figure 15

From Figure 15, we can infer that bakery store 4 has a poorer performance compared to
other two bakery stores. Most of its customers who signed up before 2017-06 have ceased
using its online ordering service. What’s worse, bakery store 4 doesn’t have a high average
CLV value compared to the other two stores.