Predicting Order Cancellations For A Leading Online Furniture Retailer

Predicting order cancellations for a leading online furniture retailer

Overview:

The client is among the leading online furniture and home decor marketplace, with a well accomplished business across multiple markets. There was in impending need to predict the possibility of order cancellations since it amounted to over $10 million in lost revenue to the retailer.

Business Challenge:

Finding enough time for business expansion while handling everyday operations like order-processing, tracking and order cancellations was a major challenge of the business. The client faced a cancellation rate of 17.8% of all orders, wherein 18.5% of revenue loss, equating to $10M of revenue losses. During the past year the client had invested Analytics Platforms to measure the performance and order cancellations but was not able to accurately determine the causal factors and the prospect of an order being cancelled.

Marlabs Solution:

This solution was built on mAdvisor, utilizing its Automated Prediction module. By analysing historical transaction data, the solution could identify key factors that were driving cancellation of orders. A custom modelling application was built that helped in automating the process of tracking order cancellations in real-time and predict the probability of an order to be cancelled. The model was intelligent enough to learn from the past data and capable of applying on new data.

The key solution differentiators are:

Seamless integration with existing Marketing Tools enabling the client to act in real time

Reduced Time to Execute – The entire modelling exercise was completed in 4 weeks

Hyperparameter Tuning – Users can get the possible accuracy for their models by leveraging hyperparameter tuning

The Impact:

Using mAdvisor’s Automated Prediction, models were built which could estimate the future order cancellations for each purchase. The predicted model results were scheduled to be sent to the client marketing automation tool daily which was used by their customer service team to take actions pre-emptively. The platform was able to accurately find the key drivers that influences the cancellation of orders. This led to:

  • 8% reduction in order cancellation rates
  • Increased annual revenue by 1.3%

About mAdvisor

mAdvisor is a patent pending AI & Cognitive Computing platform, which helps enterprises to translate data into meaningful insights and narratives without any manual intervention. Now enterprises can reduce the analytics timelines from weeks to minutes using mAdvisor.

mAdvisor employs cognitive technologies like machine learning, machine reasoning, deep learning, natural language generation, natural language processing and expert rules systems, thereby enabling enterprises to identify revenue streams, enhance customer experience and productivity.

Marlabs Inc.

About Marlabs Inc.

Marlabs helps leading companies around the world make operations sleeker, keep customers closer, transform data into decisions, de-risk cyberspace, boost legacy systems, and capture novel opportunities and digital-led revenues. It provides digital-first strategy and advisory services, rapid solution incubation and prototyping, and agile digital solution engineering. Marlabs is headquartered in New Jersey, with offices in the US, Germany, and India. Its 2,500+ global workforce includes highly experienced technology, platform, and industry specialists from the world’s leading technical universities.

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