Walmart Case

Creating difficult structured questions based on the Walmart case study in data analytics can focus
on various aspects like business problem identification, data preparation, data analysis, and
interpretation of results. Here are some examples of structured questions that challenge critical
thinking and practical application:

1. Problem Identification and Objective Definition

Question:
Walmart is experiencing fluctuating sales trends across different seasons, leading to stock
management issues. How would you define the business problem for Walmart, and what specific
data-driven objectives would you set for analyzing the sales trends?

Answer Requirements:

 Define the business problem clearly (e.g., seasonal sales fluctuations).

 Mention specific objectives such as forecasting sales, optimizing inventory, and

understanding customer purchasing patterns.

2. Data Understanding and Preparation

Question:
You are provided with the following datasets: daily sales data, weather data, and holiday data.
a) Identify key variables from each dataset that are likely to influence Walmart’s sales.
b) What steps would you take to clean and prepare these datasets for analysis?

Answer Requirements:

 Identify variables like date, product category, sales, temperature, holiday flag, etc.

 Steps may include handling missing data, removing outliers, standardizing formats, merging
datasets, and handling categorical variables.

3. Exploratory Data Analysis (EDA)

Question:
Perform an exploratory data analysis (EDA) on Walmart’s sales dataset. What are the key insights you
would extract regarding sales trends over time, across locations, and during holidays? What
visualizations would be most effective in conveying these insights?

Answer Requirements:

 Discuss time-series analysis for trends over time.

 Cross-location comparison using bar charts or heat maps.

 Highlight holiday vs non-holiday sales trends using line plots or box plots.

 Insights like peak seasons, holiday effects, or high-performing regions.

4. Feature Engineering and Selection

Question:
Walmart wants to develop a predictive model for future sales.
a) What features would you engineer from the given datasets to improve model accuracy?
b) How would you select the most relevant features for the predictive model?

Answer Requirements:

 Feature engineering could include calculating moving averages, creating lag variables,
encoding categorical variables like holidays, etc.

 Feature selection techniques could include correlation analysis, variance thresholding, and
using model-based methods (e.g., feature importance from decision trees).

5. Model Building and Evaluation

Question:
You have been tasked with building a predictive model to forecast Walmart’s daily sales.
a) What machine learning models would you consider for this task and why?
b) How would you evaluate the performance of your model?

Answer Requirements:

 Mention models like ARIMA, Random Forest, or XGBoost for regression tasks.

 Evaluation methods could include RMSE, MAE, or R-squared. Discuss cross-validation for
robust performance measurement.

6. Interpreting Model Results and Business Recommendations

Question:
After building a sales forecasting model for Walmart, the model predicts a significant increase in
sales for the upcoming holiday season. Based on this, what specific business recommendations
would you provide Walmart regarding inventory management and staffing?

Answer Requirements:

 Recommendations could include increasing stock for high-demand products, preparing

warehouses, and adjusting staffing levels in stores.

 Mention the importance of aligning supply chain logistics with predicted demand.

7. Ethical Considerations in Data Analytics

Question:
While analyzing Walmart’s customer data, you notice that certain demographic segments are more
frequently targeted for specific promotions. Discuss the ethical concerns that may arise in such cases,
and propose how Walmart should ensure responsible data use.

Answer Requirements:
  Concerns about bias, discrimination, or invasion of privacy.

 Suggest using anonymized data, ensuring transparency, and applying fairness in machine
learning models.

8. Communicating Insights to Non-Technical Stakeholders

Question:
As a data analyst, how would you effectively communicate the findings from your sales trend analysis
to Walmart’s management team, most of whom do not have a technical background?

Answer Requirements:

 Focus on simplifying technical jargon.

 Use clear visualizations (charts, dashboards).

 Highlight actionable insights, not just numbers or complex models.

These questions test the application of data analytics concepts to real-world problems, challenge
students to think critically, and assess their ability to translate analysis into actionable business
insights.

4o

You said:

Thank you please give me a case study for these questions

ChatGPT said:

ChatGPT

Here’s a hypothetical Walmart Case Study that you can use as the basis for the structured questions:

Case Study: Walmart Sales Analytics

Background:

Walmart is one of the largest retail companies in the world, with over 11,000 stores worldwide and
an extensive e-commerce platform. Despite its massive scale, Walmart faces challenges in managing
its inventory and forecasting sales, particularly due to varying factors such as holidays, promotions,
and external conditions like weather.

Recently, Walmart’s sales data from its U.S. stores revealed significant fluctuations in sales during
different seasons. For instance, sales peak during the holiday season but are less predictable during
other times of the year. This inconsistency in sales has caused issues with overstocking some items
while understocking others, leading to lost sales opportunities and increased holding costs.

Walmart’s management has tasked its data analytics team with improving the accuracy of sales
forecasts, optimizing inventory management, and understanding how external factors such as
weather and holidays impact sales trends. The team will use historical sales data, weather data, and
other relevant datasets to generate insights.

Data Available:

1. Sales Data:

o Date

o Store ID

o Item ID

o Sales Amount

o Sales Quantity

o Promotion Flag

o Holiday Flag

2. Weather Data:

o Date

o Store Location

o Temperature

o Precipitation

3. Holiday Data:

o Date

o Holiday Type (e.g., national holiday, local holiday)

4. Demographic Data (Optional):

o Store ID

o Median Income

o Population Density

o Age Distribution

Business Problem:

Walmart is struggling to maintain optimal inventory levels across its stores due to unpredictable sales
fluctuations. The company wants to implement a data-driven strategy to forecast sales more
accurately and optimize inventory to meet customer demand. Additionally, Walmart seeks to
understand the impact of external factors like weather, holidays, and promotions on sales patterns.

The primary goals are:

 1. To improve sales forecasting accuracy, especially for high-demand periods like holidays and
promotions.

2. To optimize inventory management and reduce overstock/understock situations.

3. To gain insights into the impact of weather and other external factors on sales trends.

Analysis Objectives:

1. Sales Forecasting: Develop a predictive model that can forecast daily sales for Walmart's
stores, taking into account various influencing factors like holidays, promotions, and weather
conditions.

2. Seasonality Analysis: Identify seasonal trends in Walmart's sales data, focusing on specific
time periods such as holidays, weekends, and weather-related patterns.

3. Inventory Optimization: Provide recommendations on inventory management based on the

predictive sales model, focusing on minimizing both overstock and understock situations.

4. External Factor Analysis: Assess how external factors (such as temperature, precipitation,
and holidays) affect sales at different locations and times of the year.

5. Business Recommendations: Based on the findings from the analysis, provide actionable
insights for Walmart's management on how to adjust inventory levels, promotions, and
staffing to meet customer demand.

Challenges:

1. Data Integration: Combining data from different sources (sales, weather, holidays) presents
challenges in data cleaning, preparation, and feature engineering.

2. Model Complexity: Developing a robust predictive model that accounts for a wide range of
influencing factors requires sophisticated machine learning algorithms and appropriate
evaluation metrics.

3. Actionable Insights: Translating the data-driven insights into actionable business strategies,
such as when to stock certain items or how to staff stores, is crucial for Walmart's
operations.

This case study serves as the foundation for your exam questions, encouraging students to think
critically about how data analytics is applied to real-world business problems and how they would
use their knowledge to provide insights and solutions.

You can now pair each of your structured questions with this case study, allowing students to apply
their analytical skills to answer each question based on the data provided above.