Parameter Estimates

Figure 1. Parameter estimates
Parameter estimates

Probit Analysis estimates a common slope, common natural response rate, and separate intercepts for each factor level.

  • A common slope means that increasing the value of the offer for Online customers has the same effect as increasing the value of the offer for Catalog or In-Store customers on the transformed scale. What this means in terms of the probability of someone buying is less clear-cut.
  • The estimates of the intercepts give the relative orderings of the sites. The exact quantification of the differences in terms of probabilities varies over the range of values of offers.
Figure 2. Natural response rate
Natural response rate

The natural response rate is the probability that a customer will buy if not given a promotional offer. The value of 0.041 means that roughly 4.1% of all customers would make a purchase without the offer.

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