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SIMON FRASER UNIVERSITY

Faculty of Business Administration


COURSE: BUS 445
TITLE:
Customer Analytics

SEMESTER:
FALL 2016
INSTRUCTOR: Daniel Papania

VENUE : LECTURE SUR5140 (Surrey) LAB SUR3300


TIME: 11:30am 14:20pm

Office: By appt
Email: dpapania@sfu.ca

Prerequisites:

BUEC 333 or BUS 336, BUS 343, and 60 credit hours.

Required Text:

Putler and Krider; Customer and Business Analytics: Applied Data Mining for
Business Decision Making Using R, 1st Edition. 2012. ISBN: 9781466503960

Canvas:

Course material for each week will be posted on Canvas. Any changes to
the schedule will also be posted.

Course Objectives:
This course provides an in-depth introduction to predicting customer actions, such
as the likelihood of purchasing a product or donating to a charity in response to an
offer, purchasing in a product category, defaulting on a loan, or choosing a retail
store. These predictions dramatically improve common marketing decisions such as
segmentation, targeting, upselling, cross selling, and choosing promotional content.
As such it goes beyond traditional market research and business intelligence
questions of what happened and why did it happen, towards what is likely to
happen in the future.
Smaller firms are starting analytics groups, and larger firms are expanding their
analytic capabilities as they realize the returns from competing with analytics. The
result is a demand for talent, as emphasized in a recent McKinsey report: By 2018,
as many as 140,000 to 190,000 additional specialists may be required. Also
needed: an additional 1.5 million managers and analysts with a sharp
understanding of how big data can be applied.
At the end of the course, students will be able explore and understand data relevant
to a business problem; clean and transform the data; build predictive models of the
target behaviour using statistical and machine learning techniques; and produce
evidence-based decisions, often with a concrete measure of the expected
improvement in profits. Additional analytics topics that may be addressed include
retail site location, web analytics, monitoring social media campaigns using
HooteSuite, and predicting the success of new products before they are developed.
And while very expensive commercial number crunching software is available from
a number of companies, we will use open-source software which is easy to use,
robust, common, powerful, and free. Hence, as well as the skills, an unusual
course take-away will be the software.
Student presentations emphasize the importance of clear communication and must
be business-problem-focused, in plain English, with neither formulae nor analytic
jargon.

Methods covered may include cluster analysis, discrete choice models, linear and
logistic regression, classification trees, geographical information systems, and
neural networks.
Consultation with your prof:
If you start to get lost, dont spin your wheels--make an appointment with me. I can
often find the missing pieces that will get your traction back.
Pedagogy:
1. Hands on tutorials: weekly lab sessions organized around marketing cases with real data.
A typical class will start with an introductory lecture, followed by students working in pairs (to
assist each other) through tutorials involving real problems with real data. Students will be
assigned to different pairs for each tutorial.
2. Team Based Learning (TBL): Four classes (weeks 2, 5, 11, and 12) will use a flipped
instructional method. Rather than a lecture followed by a tutorial, students will be formed into
teams to work on a problem in class. The Process for these classes:
-learn the class concepts on your own before class
-write a short Readiness Assurance quiz, individually
-repeat the Readiness Assurance quiz with your team
-Once students are definitely ready, they will work in their teams and apply the
knowledge to a significant problem.
This method has proven very successful in improving student engagement and learning across
a variety of courses. The lecture/tutorial method will be compared with the TBL method at the
end of the term on the basis of student learning and preference.
Preparation
Familiarity with fundamental marketing concepts is assumed.
Statistical knowledge assumed is correlation tables, hypothesis testing, and pvalues. Students will have seen multiple regression and crosstabs previously, but
these will be reviewed.
Grading:
Pre-class Individual Quizzes: 5%
Individual quizzes will be done online on Canvas before class. Quizzes will be
available 24 hours before class and closed ten minutes before class
Short Tutorial Exercises 11%
Each tutorial will have an exercise to be turned in by the pair of students 48
hours after the class is over.
RAT Quizzes 14%
7% on the team quiz, 7% on the individual quiz
Storytelling 10%:
Starting in Week 4, a student group will give a short (approximately 5 minutes)
presentation of the previous weeks tutorial. Purpose: Practice clear persuasive
communication of technical topics to non-technical audiences.
Assignment 1: Model Comparison, Assessment and Evaluation 10%

Individual Assignment. Purpose: Confirming understanding and providing


feedback
Assignment 2: Model Building. In Class Power Assignment 10%
Team Assignment. Purpose: Application and Feedback
Final exam: 40%
Purpose: Evaluation
In accordance with FBA policy guidelines, the median grade is typically B+.
In accordance with the Academic Honesty Policy (T10.02), academic dishonesty in any form
will not be tolerated.

BUS 445
Fall 2016 Schedule
th
7 2016 ver 1.0

Revision Date: Sep

This is a preliminary schedule. Students are responsible for monitoring Canvas


for changes.

Introduction
Week 1 Sept 8
Introduction to TBL
Introduction to
analytics:

Week 2 Sept 15
Describing and
Massaging Data

Obstacles & methods;

Importance of Business
Understanding

Frameworks: CRISP-DM &


Rapid Model Development

Introduction to R:
Read Syllabus, irat on syllabus
Exercise BC Cancer society.
Upsell to one off donors, who
to contact to maximize..
sheet

Measurement Scales;

TBL EXERCISE: MEASUREMENT


SCALES

Binning

Summary Statistics

Contingency Tables

Preparation:
Read Text Chapters
1 and 2, and
Chapter 3 pages 48
-57

Preparation:
Chapter 3, section
3.1 P 34-36
Natural and
Measured Scales
handout (posted
on Canvas)
Assessment: In-class
RAP

Predictive Modeling
Week 3 Sept 22
Exploring and
Visualizing Data
Modeling Sales

Week 4 Sept 29
Modeling Individual
Decisions: Will they
buy or not?

Scatterplots
Boxplots
Line plots
Multiple Regression
Model Fit (Adj. R2)
Indicator Variables
Log transforms for diminishing
returns

Preparation
Chapter 4 Sections
4.1, 4.2, 4.3, 4.4:
Assessment:: Online Quiz

Plot of Means
Logistic Regression
Model Fit (AIC)
Oversampling
Storytelling: California Eggs

Preparation
Chapter 5 Sections
5.1, 5.2, 5.3
Assessment:: Online Quiz

Week 5 Oct 6
Model Assessment &
Validation

Holdout / Validation Samples


Over-fitting
Lift Charts
Assignment 1 (Lift Chart)
Storytelling: CCS Monthly Giving
TBL EXERCISE: PREDICTING LOAN
DEFAULT

Week 6 Oct 13
Machine Learning
Models
(No statistics!)

Classification Trees
Storytelling: Loan Default

Week 7 Oct 20

Neural Networks
Missing Values
Storytelling: CCS Monthly
Giving

Week 8 Oct 27
Putting it all Together

Rapid Model Development


Framework
Pros and Cons of different
Models
Targeting the best prospects

Preparation
Read Chapter 6.1
and 6.2
Work through
Tutorial 6.3
Study Model
Assessment and
Validation
Powerpoint
Assessment: In-class
RAP
Preparation
Chapter 7 Section
7.1 p 165-172
Due: Assignment 1
Assessment:: Online Quiz
Preparation:
Chapter 8 Sections 8.1,
8.2
Missing Values Handout
Assessment:: Online Quiz
Preparation
Chapter 9 Sections
9.1 and 9.2
Assessment:: Online Quiz

Other Business Problems and Methods


Week 9 Nov 3
Location /
Geodemographics
(not in text)

Week 10 Nov 10th


Decision Calculus (not
in text)

Week 11 Nov 17th


Cluster Analysis

Week 12 Nov 24th


Segmentation Tutorial
(not in text)

Geographical Info Systems

TBL EXERCISE: RETAIL


SITE SELECTION
Storytelling:
UBC Dev Office
Assignment 2 (Competition)

Judgemental Calibration
-Modeling without data
Storytelling:
Retail site selection

Cluster Analysis

Storytelling: Judgmental
Calibration
TBL EXERCISE: SEGMENTATION

Preparation:
Read Retail Site
Selection Handout
Work through QGIS
Tutorial (posted)

Assessment: In-class
RAP
No Preparation
Due: Assignment 2
Competition Submission

Preparation:
Chapter10 p 235-248
Assessment:: Online Quiz
Preparation:
Chapter 11 p 259-267
Work through
segmentation tutorial on
Canvas

Assessment:
In-class RAP on Ch 10 & 11
and the Segmentation

Handout

Final Exam: TBA

TBA FINAL EXAM

VENUE to be announced