Why has the average transaction value for Bilt Mastercard purchases declined by 20% compared to the previous quarter?

Introduction

The decline in average transaction value for Bilt Mastercard purchases by 20% compared to the previous quarter is a significant issue that requires thorough investigation. This analysis will systematically identify potential root causes, validate hypotheses, and propose solutions to address the problem while considering both immediate and long-term implications for the product.

Step 1

Clarifying Questions (3 minutes)

• Looking at the timing, I'm thinking there might be seasonal factors at play. Has this decline coincided with any particular season or holiday period?

Why it matters: Seasonal trends could explain temporary fluctuations in transaction values. Expected answer: The decline is not aligned with any specific seasonal pattern. Impact on approach: If seasonal, we'd focus on year-over-year comparisons rather than quarter-over-quarter.

• Considering user segments, I'm wondering if this decline is uniform across all user groups. Have you noticed any particular demographic or user segment more affected by this decline?

Why it matters: Identifying specific affected segments could point to targeted issues or changes in user behavior. Expected answer: The decline is more pronounced among younger users or in certain geographic regions. Impact on approach: We'd focus our analysis on the most affected segments and their unique characteristics.

• Thinking about recent changes, has there been any significant update to the Bilt Mastercard rewards program or fee structure in the last quarter?

Why it matters: Changes in card benefits or costs could directly impact user spending behavior. Expected answer: There have been no major changes to the rewards program or fee structure. Impact on approach: If changes were made, we'd analyze their direct impact on transaction values.

• Considering data integrity, I'm curious if there have been any changes in how transaction values are calculated or reported. Has the definition or measurement of "average transaction value" remained consistent?

Why it matters: Ensures we're comparing apples to apples and not dealing with a data anomaly. Expected answer: The calculation method has remained consistent. Impact on approach: If there were changes, we'd need to recalculate past data using the new method for accurate comparison.