Automobile Part

Manufacturer Company's Data

MRA Project - Milestone 1
By: Taniya Dubey
Contents:
• Agenda & Executive Summary of the data
• Problem statement
• Executive Summary
• Data Sictionary
• Summary Stats
• Assumptions about data
• Exploratory Analysis & Insights
• Univariate, Bivariate, and multivariate analysis using data visualization
• Weekly, Monthly, Quarterly, Yearly Trends in Sales
• Sales Across different Categories of different features in the given data
• Summarize the inferences from the above analysis
• Customer Segmentation using RFM analysis
• What is RFM and which tool used
• What all parameters used and assumptions made
• Output table head
• Workflow image to be put when KNIME used
• Inferences from RFM Analysis and identified segments
• Who are your best customers?
• Which customers are on the verge of churning?
• Who are your lost customers?
• Who are your loyal customers?
Agenda :

01 02 03 04 05
Agenda & Exploratory RFM analysis for Identification of Recommendation
Executive analysis and customer customers based s
Summary of insights segmentation on different
the data parameters
01 Agenda & Executive Summary of
the data
• Problem statement
• About Data (Info, Shape, Summary Stats, your assumptions about data)
Problem Statement:

An automobile parts manufacturing company has

collected data of transactions for 3 years. They do not
have any in-house data science team, thus they have
hired you as their consultant. Your job is to use your
magical data science skills to provide them with
suitable insights about their data and their customers.
Executive
Summary:
• Data: past 3 years.
• Objective: identify the underlying buying patterns of the customers and
recommend customized marketing strategies for different segments of
customers.
• Dataset: 20 columns and 2747 rows,
• Missing values and Duplicate values: None
• Outliers: some columns has few outliers
• The exploratory analysis and insights provide a clear understanding of the
data and highlight the key trends and patterns in sales.
• RFM analysis has been performed to segment the customers into four
categories based on their buying behavior, and customized marketing
strategies have been recommended for each segment.
• The presentation concludes with recommendations for the company to
enhance its customer relationships and drive business growth.
 Data Dictionary

• ORDERNUMBER : Order Number • ORDERDATE : Order Date

• CUSTOMERNAME : customer • COUNTRY : Country customer
• QUANTITYORDERED : Quantity ordered • DAYS_SINCE_LASTORDER : Days_ Since_Lastorder

• PHONE : Phone of the customer • CONTACTLASTNAME : Contact person customer

• PRICEEACH : Price of Each item • STATUS : Status of order like Shipped or not

• ADDRESSLINE1 : Address of customer • CONTACTFIRSTNAME : Contact person customer

• ORDERLINENUMBER : order line • PRODUCTLINE : Product line – CATEGORY

• CITY : City of customer • DEALSIZE : Size of the deal based on Quantity

and Item Price
• SALES : Sales amount
• MSRP : Manufacturer's Suggested Retail Price
• POSTALCODE : Postal Code of customer
• PRODUCTCODE : Code of Product

Numeric columns: ORDERNUMBER, QUANTITYORDERED, PRICEEACH, ORDERLINENUMBER SALES,

DAYS_SINCE_LASTORDER, MSRP.
Assumptions:

The customer segments The marketing strategies

may be defined based may vary for each
Each row in the data The order date and days
on the purchasing customer segment, and
represents a unique since last order columns
frequency, amount the company may need
transaction made by a are accurately
spent, and recency of to personalize their
customer. calculated.
purchases (RFM marketing efforts
Analysis). accordingly.

The recommendations
The sales column is The status column provided in the
calculated as the indicates the current presentation are based
product of quantity status of the order on the insights gained
ordered and price each. accurately. from the analysis of the
transaction data.
 Statistical Summary of Numerical
Columns

Inference :
• The average number of items ordered per sales order is 35, with a standard deviation of 9.76.
• The average price of each item is 101.09, with a standard deviation of 42.04.
• The average sales amount per order is 3553.05, with a standard deviation of 1838.95.
• The average time since the last order is 1757.09 days, with a standard deviation of 819.28.
• The summary statistics do not indicate any red flags or abnormalities that could potentially indicate
issues with the data.
•
02 Exploratory Analysis &
Insights
Univariate, Bivariate, and multivariate analysis using data visualization
• Weekly, Monthly, Quarterly, Yearly Trends in Sales
• Sales Across different Categories of different features in the given data
• Summarize the inferences from the above analysis

Outliers has not been treated.

Bivariate Analysis
 • We can see that there is a dip in the yearly
sales.
Yearly Sales • We need to find more information regarding this
as its not a good sign.
 Quarterly Sales
We can see that in the quarter 4 there is high sales as compared
to other quarters.
 • We can see that in the 11th month there is highest
sales.
Monthly Sales • And in 6th month the sales is the lowest.
• Sales is consistent in the first 4 months of the year.
Weekday Sales

• We can see Thursday has

the lowest sales and
Sunday has the highest
sales.
• Sales increases from Friday
to Sunday and dips from
Monday to Thursday
 Day Sales
In the stating days of month there is more sales as compared to
the end days.
Multi-Variate
Analysis
 • We can see most of the orders which are on hold belongs to
usa, some orders on hold belong to sweden.
Status, Country • UK, USA, Spain, Sweden have aprox same number of

& Sales canceled orders.

• Spain has most disputes and also most disputes are
solved.
Order
Shipped &
Sales
• Usa has most shipped orders.
• Spain and France have aprox
same number of orders.
• Ireland have the least number
of orders shipped.
 • Most people deal parts of classic car as it has the
higher %.
Pivot Table • Parts of motercycles are the
most Disputed category.
• Least people deal with Train parts.
Sales & Customer names
 • Most sales: Classic cars

Sales & Deal •

•
Least sales: Trains
Most Deal size: medium
Size • Least Deal size: large
• Sales of truckandbuses and motercycle are aproxx same
Country, •Highest sales : USA
Product line, •Least sales: Ireland

Sales •Switzerland deals with Only classic car parts.

 Status, Sales and Deal Size

• No order of large deal type is cancelled it’s a good sign.

• Most shipped parts belong to medium deal size type.
PRODUCT LINE AND SALES
Univariate Analysis
 • We can see that sales data is skewed toward
left.
Sales • There are many outliers.
• Most data exist between 1.5k - 3.5k.
 • Outliers are present in the MRSP Data
MRSP • This data is shewed toward left .
QUANTITY • Outliers are present in the data of Quantity
ORDERED Ordered.
PRICE OF EACH • Price of Each data has money outliers
Dashboard : Sales
INFERENCES

Quarter 4 has Thursday has the

The yearly sales Sales are consistent
higher sales lowest sales, and
have dipped, which in the first 4
compared to other Sunday has the
is not a good sign. months of the year.
quarters. highest sales.

Sales increase from Spain, USA, UK, and

In the starting days Most orders on hold
Friday to Sunday Sweden have
of the month, there belong to the USA,
and dip from approximately the
are more sales than and some belong to
Monday to same number of
the end days. Sweden.
Thursday. canceled orders.

Classic car parts

Spain has the most
have the highest
disputes, and most
percentage of
disputes are solved.
sales.
Recommendation
To capitalize on the Businesses should
Businesses should
Further investigation is high sales in quarter 4, identify the reasons
focus their marketing
necessary to identify businesses should focus behind the low sales in
efforts on Thursdays to
the reasons for the dip on increasing their the 6th month and work
improve sales on this
in yearly sales. inventory during this towards addressing
day.
period. them.

Businesses should
Strategies such as Businesses should
consider offering Efforts should be made
weekend sales can be monitor canceled
discounts or promotions to resolve the orders on
employed to increase orders closely and
during the start of the hold to prevent revenue
sales from Friday to identify any trends to
month to increase loss.
Sunday. address them.
sales.

Businesses should
Steps should be taken
consider expanding
to resolve disputes
their inventory of
quickly and efficiently
classic car parts, given
to maintain customer
their high sales
satisfaction.
percentage.
03 Customer Segmentation using RFM
analysis
• What is RFM and which tool used
• What all parameters used and assumptions made
• Output table head
• Workflow image to be put when KNIME used
What is RFM ?

• Recency, frequency, monetary

value (RFM) is a marketing
analysis tool used to identify a
firm’s best clients based on the
nature of their spending habits.
• An RFM analysis evaluates
clients and customers by
scoring them in three
categories: how recently
they’ve made a purchase, how
often they buy, and the size of
their purchases.
Tool used : KNIME

KNIME, the Konstanz

Information Miner, is a
free and open-source data
analytics, reporting and
integration platform.
 What all parameters used and assumptions made

• As per instructions the column 'Days since last order' is ignored and new
column Recency as '[Max(order date)-order date]'
• We have assumed ‘01-06-2020’ as a reference date and created recency
column.
• The calculated formula for:
• Recency :- [min(Recency) customer wise].
• Frequency:- [count(customer name) customer wise]. We can also take order
quantity
• Monetary:- [sum(unit price + qty ordered) customer wise]. We can also take sales
• Based on above we have made 3 bins : high , medium , low
KNIME Workflow
Few rows of output
Inferences from RFM Analysis and
identified segments
Who are your best customers?
Which customers are on the verge of churning?
Who are your lost customers?
Who are your loyal customers?
 Top 5 best customers

• According to RFM score we have grouped the top customers.

• We have given importance to recency more and ordered the
customers accordingly.
 Top loyal customers

• Based on RFM analysis these are the loyal customers

• We have focused on monetary value
• If we focus on these customer we can turn them in to best customers.
 Verge on churning Customers

• As per RFM score we can see that these are the top customers on the verge of
churning.
• We should focus on these customers before we lose them.
• We should try some action plan to convert them into regular customers.
Top Lost Customers

• As per RFM score we can see that these are the customers which we have lost.
• There recency is very low as well as they have not made purchase frequently.
• We should study them survey them to understand the reasons why we lost
them. And take further steps so that we do not lose the customers.
05 Recommendations
 Recommendation
s
• According to RFM analysis, customers can be categorized into four distinct groups: best,
loyal, verge of churn, and lost customers. It is important to develop a focused approach for
each group in order to optimize customer retention and enhance customer experience.
• best customers, it is recommended to provide personalized recognition, exclusive offers,
and incentives to ensure that they continue to choose our company over others. By doing
so, we can maintain their loyalty and strengthen the long-term relationship.
• loyal customers, it is essential to offer periodic discounts and offers to keep them engaged
and interested in our products or services. By keeping them engaged, we can turn them into
our best customers and improve their satisfaction level with our brand.
• verge of churn customer, we need to develop an effective action plan to prevent them
from leaving the company. We can conduct surveys, offer incentives, and personalize the
communication to identify and address their concerns, and thereby increase their loyalty
towards our brand.
• lost customers, it is important to analyze their behavior and preferences to identify the
reasons for their departure. By identifying the key drivers of customer churn, we can
develop targeted strategies to prevent such occurrences in the future and improve our
overall retention rate.
Thank you