A/B Test for Pricing Page

Business Context

StreamCart, a SaaS company, tested a redesigned pricing page intended to increase free-trial signups. The product manager wants a statistically sound recommendation on whether to launch the new page.

Problem Statement

You are given results from a 21-day randomized A/B test. Determine whether the new pricing page produced a statistically significant improvement in signup conversion rate versus the current page.

Given Data

Additional test settings:

Requirements

1. State the null and alternative hypotheses.
2. Compute the sample conversion rates for both groups.
3. Calculate the pooled proportion and pooled standard error for a two-proportion z-test.
4. Compute the z-statistic and two-tailed p-value.
5. Construct a 95% confidence interval for the difference in conversion rates.
6. Decide whether the result is statistically significant at the 5% level.
7. Explain whether the observed lift is large enough to matter from a business perspective.

Assumptions

• Users were randomly assigned to control and treatment.
• Each observation represents a unique user.
• Independence between users is reasonable.
• Normal approximation is appropriate because both groups have large sample sizes and sufficient numbers of successes and failures.