Statistics: Analysis of ABZ Company's Challenges and Recommendations

This study analyzes the challenges faced by ABZ company in the entertainment market and provides actionable recommendations based on data analysis and business intelligence techniques.

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Contents
INTRODUCTION.......................................................................................................................................3
PROBLEM DEFINITION...........................................................................................................................3
VARIABLE IDENTIFICATION................................................................................................................4
DATA DESCRIPTION...............................................................................................................................5
MEASURES OF CENTRAL LOCATION.............................................................................................5
MEASURES OF VARIATION...................................................................................................................5
DATA SUMMARIZATION.......................................................................................................................6
DISCUSSION OF RESULTS AND RECOMMENDATIONS...................................................................8
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INTRODUCTION
The ABZ company is an Australian based global cooperation that trades in Books, DVDs and
CDs. These products are categorized into Novels, Politics, Classical and Bestsellers. The
company’s target market is a niche in the entertainment market composed of clients that are
drawn to traditional forms of media. The small size of this market makes the trade in traditional
media a high risk investment. However, the market size can also be viewed as a significant factor
in the product prices.
A lot of media is currently accessible on the numerous online sites available. These sites
represent a shift from the traditional, or rather physical media like the products sold by the ABZ
company. Live streaming has replaced DVDs and CDs, while eBooks have replaced physical
books. Over the last decade, this shift from traditional media has been visible with the decline in
both sales and profits of traditional media. This has meant that companies such as ABZ have to
change approaches in order to maintain profitability.
Data analysis and Business Intelligence techniques present a viable solution to challenges in
decreasing sales and profits that currently face many companies globally. Through data analysis
and business intelligence techniques, this study aims at investigating the challenges facing the
ABZ company, as well as offering actionable recommendations.
PROBLEM DEFINITION
The shift in the consumer preference from tradition media to online media has been occasioned
by the rapid development of the internet. Internet has been made more widely available with
regular increase in speeds and hence reliability. The internet provides a vast source of
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information that would otherwise be available only on CDs, DVDs and book. The growing
availability, reliability, use and acceptance has meant that the entertainment niche previously
exploited by the ABZ company has increasingly reduced.
Companies trading in traditional media, like the ABZ company, are therefore faced with an
increased reduction in sales and subsequently profits. Data analysis techniques, such as
descriptive data analysis provide adequate tools for observing and investigating this reduction
and providing actionable recommendations. Obtaining the statistics on both measures of central
location and variation give vital information on the company’s current situation.
VARIABLE IDENTIFICATION
Below is a summary description of the variables used in this research study:
1. Revenue: A numerical data variable on the daily company revenue, measured on the ratio
scale.
2. Age: A numerical data variable on the age of an ABZ customer, measured on the ratio
scale.
3. Amount: A Numerical data variable on the amount of payment made by an ABZ
customer, measured on the ratio scale.
4. Profits: A numerical data variable on the daily company profits, measured on the ratio
scale.
5. Gender: A Categorical data variable on the gender of an ABZ customer, measured on the
nominal scale.
6. Sales: A Numerical data variable on the daily company sales, measured on the ratio scale.
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7. Products: A Categorical data variable on the product category of the products bought by
an ABZ customer, measured on the nominal scale.
DATA DESCRIPTION
MEASURES OF CENTRAL LOCATION
The measures of central location for the data on the ABZ company are as given in Table
1:Measures of Central Location below. The mean values for the Revenue, Age, Amount, Profits
and Sales are 286.5, 43 (rounded off from 43.1), 39.8, 26.3 and 90.5 respectively.
Table 1:Measures of Central Location
Variable Mean Mode Standard Deviation
(sd)
Revenue 286.5 270.0 59.6
Age 43.1 46.0 12.3
Amount 39.8 15.3 57.6
Profits 26.3 8.4 17.8
Sales 90.5 37.3 67.9
MEASURES OF VARIATION
The measures of variation of the data on the ABZ company are as given in Table 2: Measures of
Variation below. The range of the values of the Revenue, Age, Amount, Profits and Sales are
310, 58, 231.6, 70.6 and 351.9 respectively.
Table 2: Measures of Variation
Variable Range Lower
Quartile
Upper
Quartile
IQR
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Revenue 310.0 252.3 298.0 45.8
Age 58.0 32.0 50.0 18.0
Amount 231.6 17.7 23.3 5.6
Profits 70.6 9.7 36.4 26.7
Sales 351.9 39.4 107.1 67.7
DATA SUMMARIZATION
Both Table 3: Gender Comparison and Figure 1: Gender Comparison below give the
classification and comparison of gender with respect to amount. They indicate that there exists a
difference between the males and females with regards to the amount of purchases of ABZ
products made, with females making higher purchases than males.
Table 3: Gender Comparison
Gender Amount
Female 15041.1
Male 873.5
Female Male
0.0
2000.0
4000.0
6000.0
8000.0
10000.0
12000.0
14000.0
16000.0
Gender Comparison
Total
Gender Categories
Amount
Figure 1: Gender Comparison (Source: Excel)
Both Table 4: Product Comparison and Figure 2: Product Comparison below give the
classification and comparison of product categories with respect to amount. They indicate that
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there exists a difference between the different ABZ product categories with regards to the
amount of purchases of the ABZ product categories. The top and worst selling ABZ product
categories are DVD and CD respectively.
Table 4: Product Comparison
Product Amount
Best
seller
2340.1
CD 1522.4
Classical 1774.9
DVD 6012.2
Novel 2263.6
Politics 2001.3
Best seller CD Classical DVD Novel Politics
0.0
1000.0
2000.0
3000.0
4000.0
5000.0
6000.0
7000.0
Product Comparison
Total
Product Categories
Amount
Figure 2: Product Comparison (Source: Excel)
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DISCUSSION OF RESULTS AND RECOMMENDATIONS
The findings from the data analysis on the data from the ABZ company show that the company’s
average Revenue, Consumer Age, Consumer Amount Spending, daily Profits and daily Sales are
286.5, 43 (rounded off from 43.1), 39.8, 26.3 and 90.5 respectively. They also indicate that the
range for the company’s Revenue, Consumer Age, Consumer Amount Spending, daily Profits
and daily Sales are 310, 58, 231.6, 70.6 and 351.9 respectively. In addition, the amount spent
differs depending on gender of the customer while there exists difference in the product
categories with regards to their sales. The DVD is the top selling product category with the CD
being the worst selling.
The ABZ company should focus on their most profitable customers, which are the female
customers while at the same time trying to target more male clients. With the DVD as the top
selling category, the ABZ can afford to divert the DVD marketing resources to the other product
categories to boost their sales.
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