Simpson's Paradox: Overall Conversion Rate Rises While Each Segment Declines

A hypothetical analysis of two marketing channels, Email and Search, shows a statistical paradox. In Period B, the conversion rate fell for both Email and Search individually compared to Period A. However, the overall conversion rate more than tripled because the audience mix shifted heavily toward the higher-converting Email channel. This demonstrates Simpson's paradox, where aggregate trends can reverse within every subgroup. The example highlights the importance of analyzing segment performance separately from overall metrics.