Analytics_Report Ch.3 Shaynah Merilan

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Apr 3, 2024

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ANALYTICS REPORT TO: WALMART PRICING DEPARTMENT FROM: SHAYNAH MERILAN SUBJECT: ANALYSIS OF ONLINE WOMEN’S SHOE PRICES DATE: 07 FEBRUARY 2024 Introduction In this analytics report, we utilized a pivot table to identify Walmart's competitors, focusing on companies selling a minimum of 100 shoes at lower prices. Our selection criteria led us to three competitors whose pricing closely aligns with Walmart's. These chosen companies will be the basis for our comparative analysis, shedding light on Walmart's performance in the market. Data Analysis How We Determined Walmart’s Competitors In our analytics report, we employed a pivot table to pinpoint Walmart's competitors. We focused on companies selling a minimum of 100 shoes at lower prices, ultimately narrowing down our selection to the three closest competitors in terms of pricing. These chosen companies will serve as the basis for comparing Walmart's performance in the market. ANOVA H 0 : None of the average shoe price is different across the 4 merchants (Walmart, Amazon, Overstock, and Sears). H A : At least one average shoe price is different across the 4 merchants (Walmart, Amazon, Overstock, and Sears). Because the p-value = 4.66E-16 is less than the significance level of 0.05, we can reject the null hypothesis and conclude that at least one average shoe price is different across the 4 merchants. To determine which merchants, have different prices and by how much, we will use Fisher’s Confidence Intervals. Walmart vs Amazon H 0 : Walmart and Amazon do not have different average prices. H A : Walmart and Amazon have different average prices. ( 63.95 − 71.63 ) ± 1.9602 √ 2697.65 ( 1 8183 + 1 192 ) [-15.12, -0.25] Since zero is not included in the interval, we can reject the null hypothesis and conclude that Walmart and Amazon have different average prices. Since the interval was set up as Walmart

minus Amazon and is entirely negative, we can say Walmart has lower prices by somewhere $0.25 and $15.12. Walmart vs Overstock H 0 : Walmart and Overstock do not have different average prices. H A : Walmart and Overstock have different average prices. ( 63.95 − 67.27 ) ± 1.9602 √ 2697.65 ( 1 8183 + 1 17951 ) [-4.68, -1.96] Since zero is not included in the interval, we can reject the null hypothesis and conclude that Walmart and Overstock have different average prices. Since the interval was set up as Walmart minus Overstock and is entirely negative, we can say Walmart has lower prices by somewhere $1.96 and $4.68. Walmart vs Sears H 0 : Walmart and Sears do not have different average prices. H A : Walmart and Sears have different average prices. ( 63.95 − 80.58 ) ± 1.9602 √ 2697.65 ( 1 8183 + 1 669 ) [-20.61, -12.65] Since zero is not included in the interval, we can reject the null hypothesis and conclude that Walmart and Sears have different average prices. Since the interval was set up as Walmart minus Sears and is entirely negative, we can say Walmart has lower prices by somewhere $12.65 and $20.61. Recommendation Based on the statistical analyses, it can be concluded that Walmart's average shoe prices are significantly different from those of its competitors (Amazon, Overstock, and Sears). Walmart consistently offers lower prices, providing a competitive advantage. Therefore, the recommendation is for Walmart to maintain its current pricing strategy to remain competitive in the women's shoe market. The results suggest that Walmart is successfully offering more affordable options compared to its major competitors. Conclusion By conducting ANOVA and comparing the average shoe prices of Walmart, Amazon, Overstock, and Sears, we identified meaningful variations. Specifically, Walmart stands out as the most budget-friendly choice among these three key competitors. The thorough analysis indicates that Walmart's current pricing approach effectively positions it as the most economical option. Hence, the suggestion is to uphold the current pricing strategy, aligning with Walmart's aim of providing cost-effective products to its customers. Reach out for more details or questions shaynahm@arizona.edu. Thank you for your time.

Appendix Appendix 1- Bar Graph of Average Prices by Merchants Walmart Amazon.com Overstock.com Sears.com $0 $10 $20 $30 $40 $50 $60 $70 $80 $90 $64 $72 $67 $81 Total Total Merchant Avg Price Appendix 2- ANOVA Output Anova: Single Factor SUMMARY Groups Count Sum Average Variance Walmart 8183 523285.85 63.94792252 4017.527047 Amazon 192 13753.795 71.63434896 2608.851451 Sears 669 53908.46 80.5806577 8593.913944 Overstock 17951 1207558.735 67.26971951 1877.537915 ANOVA Source of Variation SS df MS F P-value F crit Between Groups 201219.6525 3 67073.21749 24.86358457 4.66195E-16 2.605238172 Within Groups 72812237.02 26991 2697.648735 Total 73013456.67 26994 Shaynah Merilan

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