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Background Information: The local brewery Surly launched a new product, a pale largely targeted towards the residents of the Twin Cities. To promote the
Background Information: The local brewery Surly launched a new product, a pale largely targeted towards the residents of the Twin Cities. To promote the new beer, Surly ran a digital campaign with two ads, Ad A and Ad B on the StarTribune website. Individuals who visited the StarTribune during the campaign period were exposed to each ad at most once. That is, some were exposed to neither ad, Ad A only, Ad B only, or both ads. For every exposure to one ad, Surly paid $0.3 to the platform. In the event that consumers bought the new beer, they spend $8 on average. Soon managers at Surly realized that they are better at brewing beer than running digital marketing campaigns, and so they hired you to analyze their campaign data and provide recommendations for improvement. Data: Surly collected data from 5000 individuals who visited the StarTribune website during the campaign period. The data include demographic information about each individual, indicators that represent ad exposure conditions, and whether or not each individual bought the new beer (i.e., conversion). For the demographics, consumers younger than 35 years old are classified as "Young", or else are classified as "Old." The following table presents a description of the variables in the data. Variable User Young Ad_A Description Unique user identifier Indicates whether the individual is young or old. Young-1 if the individual is younger than 35, and 0 otherwise. Indicates whether Ad A is shown to the individual. Ad_A=1 if Ad A is shown to the individual, and 0 otherwise. Ad_B Indicates whether Ad B is shown to the individual. Ad_B-1 if Ad B is shown to the individual, and 0 otherwise. Conversion Indicates whether the individual converted. Convertion=1 if the individual converted, and 0 otherwise. Based on the initial understanding of the data, Surly obtained the following information: Out of the 5,000 individuals, there were 2,652 total impressions to at least one ad. 202 out of the individuals who were exposed to at least one ad ended up purchasing Surly beers after the exposure. 347 (out of the 5,000) individuals purchased Surly beers, no matter whether they were exposed to Surly's ad. The table below presents the number of individuals in each age group (Young vs. Old) under each ad exposure condition. Note: you will use the numbers in this table for Question 4 below. Ad Exposure Condition Consumer Type Young Old Ad A only 459 411 Ad B only 527 527 Both ads 190 174
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