8. A/B Testing (Fast Food Company)
Background
Hungrii, a fast-food company, plans to add a new item to its menu and has three possible marketing campaigns for promotion. To determine the most effective promotion on sales, the new item is introduced in randomly selected markets. Different promotions are used at each location, and the weekly sales of the new item are recorded for the first four weeks.
Problem Definition
Hungrii is still undecided between the three possible marketing campaigns to promote the new product. As the data analyst in this company, my task is to analyze and determine which promotion has the greatest effect on sales.
Objective
Use A/B testing to analyze which promotion is the most effective on sales, and utilize two-tailed tests for the significance test.
Task & Actions
Results
Recommendations based on the results of A/B testing:
Promotion 2 is not recommended for any market size
Large market size: either Promotion 1 or 3 can be used, but Promotion 3 is slightly better
Medium market size: use Promotion 1
Small market size: either Promotion 1 or 3 can be used, but Promotion 1 is slightly better
