Weekly Arrangements
Arrangements each week
This page provides a detailed weekly arrangement for the module. You can find the pre-class preparation, in-class topics, and after-class exercises for each week here.
Since marketing is evolving rapidly, we will cover a wide range of topics in this module. I’m also updating the contents each year to keep up with the latest trends in marketing analytics. Therefore, remember to check this page each week before class to ensure you are well-prepared for the lecture and case study workshop.
Before the lecture
Each week, you are required to complete pre-class preparation tasks.
The preparation usually includes reading case studies, watching videos, or completing coding exercises.
You can find the pre-class preparation under each week’s topic in this guide and on Moodle.
It’s mandatory to finish the pre-class preparation for best learning outcomes. Otherwise, you may find it hard to follow the lecture and case study workshop.
During the lecture
We will have a 3-hour session on each Wednesday for 10 weeks.
Each week, I will cover a new analytics tool, followed by a case study workshop for you to practice the new technique. This way, you can further reflect on your understanding of the technique by practicing your skills with a real-life application.
For instance, in week 1 and week 2, I will first introduce the concepts of marketing and marketing process, and then will cover the concept of break-even analysis, net present value, customer lifetime value (CLV) and how to compute CLV with R. We will then solve a case study that helps you practice your knowledge of CLV, so you can understand how to use CLV for better marketing decisions in your future projects/jobs.
Similarly for the rest of the weeks, we will cover a new analytics tool and then practice it with a case study.
After the lecture
After each week’s lecture, you will find a list of After-class reading and exercises. Some are essential, while others are optional.
- Essential: contents and R exercises core to this week’s materials. All pre-class preparations are expected to be completed.
- Optional: supplemental readings for those interested in learning more about the topic.
Module Outline
Week | Substantive Topic | Methodology Topic | Case Study |
---|---|---|---|
Induction Week | Basics of R | ||
1 | Profitability Analysis | Arithmetic computation with R | Profitability Analysis for Apple Inc. |
2 | Customer Lifetime Value | Arithmetic computation with R | Customer Lifetime Value to Improve Marketing Profitability |
3 | Descriptive Analytics for Preliminary Customer Analysis | Data wrangling with R | Preliminary Customer Analysis and RFM Analysis for Marks & Spencer |
4 1st assignment due Friday, 25 October 2024 |
Customer segmentation | Unsupervised learning (K-means clustering) | Using Unsupervised Learning to Improve Marketing Efficiency for Marks & Spencer |
5 | Customer targeting | Supervised learning (Decision tree and random forest) | Using Supervised Learning to Improve Marketing Efficiency for Marks & Spencer |
6 | Causal Inference | Rubin Causal Model, Potential Outcome Framework, and A/B Testing | |
7 | A/B/N Testing | Linear Regression for Causal Inference | Improve User Engagement for Instagram Using A/B/N Testing |
8 2nd assignment due Friday, 15 November 2024 |
Platform Design | Instrumental variable and two-stage least square | |
9 | Platform Design | Regression Discontinuity Design | Estimating Causal Effects for Platform Businesses Using Instrumental Variables |
10 | Frontiers in Marketing Analytics | Difference-in-Differences & Causal machine learning |
|
3rd assignment due Friday, 13 December 2024 |
Induction Week: R Basics
Install R, RStudio, and Quarto following the guide.
Finish reading “An introduction to R” (can be assessed in this link) (Chapters 1, 2, and 3 at least). Please try to practice the codes in R along your reading. Take a note of any questions you may have during your self-study. I will cover R basics in greater details in the induction week.
What you will learn
- An introduction to R basics
After-class exercise
(essential) Finish the after-class exercise. We will learn how to use R to compute customer lifetime value in Week 1, so it’s very important that you are familiar with R basics before class.
As you will be learning both R and Python at the same time, it’s a good habit to keep a systematic record of the difference between the 2 languages. For this purpose, I have made this guide for you based on my own experiences.
Week 1: Module Introduction and Profitability Analysis
Please bring your laptop to class every week. We will be practicing R programming in class.
Review R basics lecture notes covered by Wei on Friday in the induction week (the recording is under the Induction week section); If you missed the session, it’s very important to catch up by watching the recording.
Complete the pre-class R exercise on the Case-BreakEvenAnalysis-Stu.qmd. You can find and download the file below.
Read the Case study: “Profitability Analyses for Apple Inc”. Don’t worry about the questions yet, please focus on the case background. information.
Class 1: Module Introduction
What you will learn
An overview of the course topics
Concepts of marketing and the marketing process (5Cs, STP, and 4Ps)
How marketing analytics can empower marketers in the digital era
After-class reading and exercise
- (optional) The Definitive Guide to Strategic Marketing Planning. Highly recommended if you didn’t take marketing undergrad courses and would like to know more about the conventional marketing process.
Class 2: Profitability Analysis
What you will learn
How to conduct break-even quantity for a marketing proposal
How to conduct net present value analysis for a marketing proposal
Week 2: Customer Lifetime Value
Read the case study. Think about the following questions, which we will discuss in class.
What would be the time unit of analyses? monthly or yearly? How many years of customer’s lifetime to consider for CLV calculation? Is this reasonable?
What is the information needed to calculate the net cash flows of a customer in each period? Where can you find the M and c in the CLV formula? Highlight these key numbers in the case study so that we can create them in R directly.
How do we incorporate customer churn in CLV calculation?
What are the costs needed to acquire a customer? Based on this information, how to compute the customer acquisition costs (CAC)?
Can you figure out how to compute CLV with pen and paper before Wednesday class?
You can try your best to use what we have learned in Week 1 to complete the case on your own. The exercise Quarto file can be downloaded on Moodle.
Class 3: Customer Lifetime Value
What you will learn
The concept of customer lifecycle and customer lifetime value (CLV)
How to compute customer acquisition costs (CAC)
How to compute customer lifetime value (CLV)
Class 4: (Case Study) Customer Lifetime Value for Guiding Marketing Decisions
What you will learn
How to apply CLV calculation in a real-life case study
Discuss how CLV can be used by marketers to guide marketing decisions
After-class reading and exercise
After-class exercise for Week 2
(optional) “Hubspot: How to compute CLV”. This article introduces alternative ways to compute CLV, which are used in many companies.
Week 3: Data Wrangling for Descriptive Analytics
Read the case study: Preliminary Customer Analysis.
Please familiarize yourself with the variable definitions in the case study. This is very important as we will use the dataset to learn data wrangling in R using the dplyr package.
Open the csv file in Excel and inspect the data sets. Focus on the data structure, including what each row means and what each column means
Class 5: Data Wrangling with R
What you will learn
Process of a typical data analytics project (such as your term 3 dissertation)
How to use
filter
,mutate
,arrange
, andgroup_by
for data manipulation withdplyr
package in R
Class 6: (Case Study) Descriptive Analytics for M&S
What you will learn
- How to use
dplyr
to conduct preliminary customer analyses for Marks & Spencer
- How to use
After-class reading and exercise
- (essential) Cheatsheet for
dplyr
. This cheatsheet provides a quick reference for the most commonly used functions in thedplyr
package. It’s very important to familiarize yourself with these functions as you will use them a lot in your future projects. - (optional) Complete the after-class exercise for Week 3. If you still have time, you can also complete the data camp exercise on the dplyr package. The link is here.
- (essential) Cheatsheet for
Week 4: Unsupervised Learning for Customer Segmentation
- Read the case study: Improving Marketing Efficiency for Marks & Spencer Using Predictive Analytics.
Class 7: Unsupervised Learning and K-Means Clustering
What you will learn
The concept of predictive analytics
The difference between supervised and unsupervised learning
Important concepts in predictive analytics
Concept of unsupervised learning
How to run K-means clustering in R
Class 8: (Case Study) Customer Segmentation Using K-Means for M&S
What you will learn
- How to apply K-means clustering to help Marks & Spencer segment its customers
After-class reading and exercise
- (optional) K-means Cluster Analysis, which provides more details on the maths behind the K-means clustering
Week 5: Supervised Learning for Customer Targeting
Case Study: Customer Targeting Using Supervised Learning for Marks & Spencer
- Please carefully read the case background before class, and complete the pre-class coding exercise.
Class 9: Supervised Learning and Tree-based Models
What you will learn
Definition of supervised learning
Types of supervised learning
Fundamental tradeoffs in supervised learning
Overfitting and underfitting issues and how to overcome them
Intuition behind decision tree and random forest models
How to build random forest models in R
After-class reading and exercise
(optional) Decision tree in R and Random forest in R. Both tutorials introduce the detailed maths behind the two models if you would like to learn more
Class 10: (Case Study) Improve Marketing Efficiency for Marks & Spencer Using Supervised Learning
What you will learn
- How to apply supervised learning models (random forest and others) to help Marks & Spencer improve its marketing efficiency
Week 6: Causal Inference, Potential Outcome Framework, and A/B Testing
Class 11: Causal Inference, Potential Outcome Framework
What you will learn
Concept of causal inference
Concept of Rubin’s potential outcome framework and treatment effects
Why randomized experiments (A/B testings) is the gold standard of causal inference
After-class reading and exercise
Class 12: A/B Testing
What you will learn
How to design and conduct randomized experiments
How to interpret the results of randomized experiments
How to use randomized experiments to solve real-life marketing problems
Week 7: Linear Regression
- Case study: Improve User Engagement for Instagram Using A/B/N Testing. Please carefully read the case background before class; we will be discussing the case in class
Class 13: (Case Study) Improve User Engagement for Instagram Using A/B/N Testing
What you will learn
Steps to design and conduct a randomized experiment (A/B testing)
The business model of social media platforms
Design an A/B testing to help Instagram to improve user engagement
After-class reading and exercise
Class 14: Linear Regression for Causal Inference
What you will learn
Review of concept for Data Generating Process (DGP) and a model
The intuition behind coefficient estimation of linear regression models
How to run linear regression models in R
How to interpret the regression coefficients and statistics
How to interpret the coefficients of categorical variables
After-class reading and exercise
- (optional) Introduction to Econometrics with R, Chapters 4-7. These 4 chapters cover very detailed applied knowledge of linear regressions. Due to limited time, we cannot cover all contents in class, so it would be great if you can take time to go through these chapters thoroughly.
Week 8: Endogeneity and Instrumental Variables
Class 15: Endogeneity
What you will learn
Understand the reasoning why linear regression can almost never provide causal effects from non-experimental data.
Understand the concept of endogeneity and its causes.
After-class reading and exercise
Class 16: Instrumental Variables and Two-Stage Least Square
What you will learn
Intuition of why instrumental variables solve endogeneity problems
The requirements of a valid instrumental variable and how to find good instruments
Apply two-stage least square method to estimate the causal effects using instrumental variables
After-class reading and exercise
Week 9: Quasi-Experimental Methods
Case Study: Estimating Causal Effects for Platform Businesses Using Instrumental Variables
- Please carefully read the case background before class and we will be discussing the case in class.
Class 17: (Case Study) Estimating Causal Effects for Platform Businesses Using Instrumental Variables
What you will learn
Understand the importance of causal inference for platform businesses
Learn how to estimate causal effects using instrumental variables with an application to ride-sharing platforms
(highly recommended) Encouragement Designs and Instrumental Variables for A/B Testing at Spotify
Class 18: Natural Experiment I: Regression Discontinuity Design
What you will learn
Concept of regression discontinuity design
Estimation of causal effects using regression discontinuity design
Application of regression discontinuity design in the business field
After-class reading and exercise
- (optional) Econometrics with R: Quasi-experiments
Week 10: Frontiers of Marketing Analytics
Class 19: Natural Experiment II: Difference-in-Differences Design
What you will learn
Concept of difference-in-differences (DiD) design
Estimation of causal effects using the DiD design
Synthetic Difference-in-Differences Method when the parallel trend assumption is violated
Class 20: Frontiers of Marketing Analytics
What you will learn
Applications of Causal machine learning and NLP
Review of module and recommendations on dissertations
After-class reading and exercise
Estimate causal effects using ML by Microsoft Research
Athey, Susan, and Stefan Wager. ‘Estimating Treatment Effects with Causal Forests: An Application’. ArXiv:1902.07409 [Stat], 20 February 2019. http://arxiv.org/abs/1902.07409.