Re: Determining email test quantities

From: Stuart Hochwert <shochwert_at_myfree.com>
Date: Sat 15 Apr 2000 09:00:22 -0500

SANDI LINDENKOHL WROTE:
> Direct Response Price Test question
> I'm planning to do a price elasticity test for a
> service via email. I'm looking for guidance in
> setting my outgoing mail quantities high enough to
> ensure I get statistically reliable results.

When publishers do test panels of 5000 per cell, they
are using a soft (free trial) offer that typically has
a 5 - 10% gross response rate and a 20 - 40% pay-up.
Thus they get 350 gross orders and about 100 payments.
When you read anything on the subject or do your own
confidence testing you will see you need about 100 paid
orders for validation at the approximate 95% confidence
level. Again, this is really oversimplified.

If you are doing an e-commerce campaign via e-mail, I
would expect the order rate to be under 1%. Thus, to
get 100 orders per cell would require a cell size of at
least 10,000.

Hope this helps.

-------------------------------
Stuart Hochwert shochwert_at_myfree.com
MyFree.com, Inc.
3400 Dundee Road, Suite 236
Northbrook, IL 60062
847-205-9320 Main 847-205-9340 Fax
Over 1,000,000 opt-in e-mail newsletter subscribers
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Received on Sat Apr 15 2000 - 09:00:22 CDT