Description: This project, the 1st project of my Udacity Nanodegree on Predictive Analytics for Business, focuses on predicting the expected profit from sending a catalog to 250 new customers of a high-end home goods company. The goal is to determine if the expected profit contribution exceeds $10,000, considering the costs of printing and distributing the catalog and the average gross margin on products sold through the catalog. The project involves analyzing data and making a recommendation to the manager based on the predicted profit.
Key Points:
-Project Type: Udacity Nanodegree Project
- Objective: Predict the expected profit from sending a catalog to 250 new customers
- Business Problem: Determine if the expected profit exceeds $10,000
- Factors:
- Cost per catalog: $6.50 (printing and distribution cost)
- Average gross margin: 50% (gross margin = price - cost)
- Steps: 1. Analyze the data and build a predictive model for profit estimation.
2. Calculate the expected profit by multiplying revenue by the gross margin and subtracting the cost per catalog.
3. Compare the predicted profit to the $10,000 threshold.- Recommendation: Provide a short report to the manager outlining the recommendation and the reasons for it.