You are in charge of design of your company’s online store. As part of improvements, you test whether a different design will improve the proportion of visitors to the store that “convert” – that is go on to make a sale

Assignment 2

Question 1 (12 marks)

You are in charge of design of your company’s online store. As part of improvements, you test whether a different design will improve the proportion of visitors to the store that “convert” – that is go on to make a sale.

A random sample of customers visiting the online store in one week were randomised to see either Design A or Design B. Then whether that visit converted to a sale was recorded.

The tab Q1 in your data file contains the result of a pivot table constructed from this test, in a format similar to the table below.

  Converted to sale
  Converted Did Not Convert
Design A    
Design B    

 

a) What is the name of the statistical test you should use to determine if there is a difference in conversion rate between the two designs? (1 mark)

b) What are the null and alternative hypotheses for this test? (2 marks)

Carry out the hypothesis test, using a 5% significance level

c) Produce a table of expected values and copy it into your answer (2 marks)

d) Determine the p value, using the CHISQ.TEST() function, and report it. (2 marks)

e) What are the assumptions of this test? Have they been met? (2 marks)

f) What decision do you make about the null hypothesis? (1 mark)

g) What do you conclude? (2 marks)

Question 2 (14 marks)

In this question, your task is to identify which of two online shop designs (labelled Design C and Design D) leads to a higher total purchase among those who make a purchase.

A random sample of purchases were randomly allocated to be shown either Design C or Design D. The purchase total for the customers who made a purchase are shown in the columns Design C and Design D of tab Q2 in your data file.

a) Why should you use an independent samples test for these data? (1 mark)

b) Define the parameters for this test. (2 marks)

c) What are the null and alternative hypotheses for this test? (2 marks)

Carry out the hypothesis test, using a 5% significance level

d) Copy the results from excel into your answer, and report the p value. (2 marks)

e) What are the assumptions of this test? Have they been met? (2 marks)

f) What decision do you make about the null hypothesis? (1 mark)

g) What do you conclude? (2 marks)

h) What improvements can you suggest to this method of investigating the benefits or otherwise of the two shop designs? (2 marks)

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