Establishing Cause and Effect from Data

1. Establishing Cause and Effect from Data Jason McFall, Causata

3. Use temporal information Causes precede effects

4. Granger causality Does wage inflation lead to price inflation, or vice versa? U W P X

5. Store all the detail, in time order WebsiteSession Call Center Question WebsiteSession WebsiteSession Loyalty Card Promo Email Loyalty Card Sign Up Major Product Purchase in Store

7. time filter customer journeys

8. before after relative time time align filter customer journeys

9. Build models

10. Analysing observational data is hard Bayesian networks D G Im IR BP U T X P X W

11. Experiment Put the science into data science

12. Randomised Controlled Trials INTERVENTION Measure outcomes for both groups Split population randomly into two groups CONTROL

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14. Randomise

15. Concurrent control

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17. Bandit algorithms Including random exploration

18. Regulated exploration/exploitation response rate

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22. Measure the right thing! Click on ad • Acquire new customer • Retain Customer

24. Beware of bias Credit: Flickr winnifredxoxo

25. Beware of bias

26. Confirmation bias

28. Summary Analysing observational data is HARD. It’s often much easier to do experiments! Randomise Use concurrent controls Be alert to bias 1 2 3 4

29. Thankyou