Quality Leadership University

Prof. Hilmar Castro

June 2018
§ Day 1
§ What is Marketing Research
§ Uses of Marketing Research
§ The Marketing Research Process
§ Statistics and Marketing Research
§ Basic concepts
§ Practice Exercises
Marketing research is the process of designing, gathering, analyzing,
and reporting information that may be used to solve a specific marketing
problem.

To practice marketing well in

today’s environment requires
more and better information.
As you will learn, marketing
research provides information
to decision makers.
§ Identifying Market Opportunities and Problems
§ Generate, Refine, and Evaluate Potential
Marketing Actions
§ Selecting Target Markets
§ Product Research
§ Pricing Research
§ Promotion Research
§ Distribution Research
§ Monitor Marketing Performance
§ Improve Marketing as a Process
1. Establish the need for marketing research.
2. Define the problem.
3. Establish research objectives.
4. Determine research design.
5. Identify information types and sources.
6. Determine methods of accessing data.
7. Design data collection forms.
8. Determine the sample plan and size.
9. Collect data.
10. Analyze data.
11. Prepare and present the final research
report
§ Statistics is a vital part of market
research.
§ Without statistics, market research
would be impossible because
statistics provide the data and
information necessary to carry out
proper market research.
§ Statistics and marketresearch then,
go hand in hand as one is not
possible without the other.
§ Marketing researchers transferdata from the data collection forms and
enter the data into software packages that aid them in analyzing the
data.
§ The objective of data analysis is to use statistical tools to present data
in a form that satisfies the research objectives.
§ If the research objective is to determine if there are differences in
intention to purchase a new product between four levels of income
groups, data analysis would be used to determine if there are any
differences in intention to purchase between the income groups and to
determine if these differences (based on sample data) actually exist in
the population.
§ Population: A population is defined as
the entire group under study as specified
by the objectives of the research project.
§ Census: A census is defined as an
accounting of the complete population.
§ Sample: A sample is a subset of the
population that suitably represents that
entire group
§ Sample Unit: A sample unit is the basic
level of investigation.
§ Sample Frame: A sample frame is a
master source of sample units in the
population.
§ Sample Frame Error: A sample
frame invariably contains sample
frame error, which is the degree to
which the sample frame fails to
account for all of the population.
§ Sampling Error: Sampling error is
any error in a survey that occurs
because a sample is used.
§ The size of
a sample directly affects its degree of accuracy or error,
which is completely different from representativeness.
§ Sample accuracy refers to how close a random sample’s statistic is to
the population’s value it represents.
A confidence interval is a
range whose endpoints define
a certain percentage of the
responses to a question.
A confidence interval is based
on the normal, or bell shaped,
curve commonly found in
statistics.
 where
n = the sample size
z = standard error associated with the chosen level of confidence
(typically, 1.96)
p = estimated percent in the population
q = 100 – p
e = acceptable margin of sample error
§ Two areas of statistics are used: descriptive statistics and inferential
statistics.
§ Descriptive statistics includes visual tools such as charts and graphs
and also the numerical measures such as the arithmetic average. The
role of descriptive statistics is to describe data and help transform data
into usable information.
§ Inferentialtechniques are those that allow decision-makers to draw
conclusions about a large body of data by examining a smaller subset
of those data. Two areas of inference, estimation and hypothesis
testing, are described.
§ The problem confronting the marketing researcher when faced with a
dataset is data analysis, which is defined as the process of describing a
dataset by computing a small number of statistics that characterize
various aspects of the data.
§ Five basic types of statistical analyses can be used by marketing
researchers to reduce a dataset:
§ descriptive analysis
§ inferential analysis
§ differences analysis
§ associative analysis,
§ predictive analysis
§ Data can be classified as being either quantitative or qualitative.
§ Data can also be cross-sectional or time-series.
§ Another way to classify data is by the level of measurement. There are
four levels from lowest to highest: nominal, ordinal, interval, and ratio.
§ Knowing the type of data you have is very important because the data
type influences the type of statistical procedures you can use.
§ Quantitative Data: Measurements
whose values are inherently
numerical.
§ Qualitative Data: Data whose
measurement scale is inherently
categorical.
§ Time-Series Data: A set of
consecutive data values observed
at successive points in time.
§ Cross-Sectional Data: A set of
data values observed at a fixed
point in time.
§ Frequency Distribution: A summary of a set of data that displays the
number of observations in each of the distribution’s distinct categories
or classes.
§ Discrete Data: Data that can take on a countable number of possible
values.
§ Relative Frequency: The proportion of total observations that are in a
given category. Relative frequency is computed by dividing the
frequency in a category by the total number of observations. The
relative frequencies can be converted to percentages by multiplying by
100.
§ Cumulative Frequency
Distribution: A summary
of a set of data that
displays the number of
observations with values
less than or equal to the
upper limit of each of its
classes.
§ Cumulative Relative
Frequency Distribution:
A summary of a set of data
that displays the
proportion of observations
with values less than or
equal to the upper limit of
each of its classes.
Step 1 Convert the
frequency distribution
into relative frequencies
and cumulative relative
frequencies.
Step 2 Construct the relative
frequency histogram.
Place the quantitative variable
on the horizontal axis and the
relative frequencies on the
vertical axis. The vertical bars
are drawn to heights
corresponding to the relative
frequencies of the classes.
Step 3 Construct the ogive.
Place a point above the
upper limit of each class at
a height corresponding to
the cumulative relative
frequency. Complete the
ogive by drawing a line
connecting these points.
§ The basic data analysis goal involved in all measures of central
tendency is to report a single piece of information that describes the
most typical response to a question. The term central
tendency applies to any statistical measure used that somehow
reflects a typical or frequent response.
§ Mode: The mode is a descriptive analysis measure defined as that
value in a string of numbers that occurs most often.
§ Median: An alternative measure of central tendency is the median,
which expresses that value whose occurrence lies in the middle of an
ordered set of values.
§ Mean: A third measure of central tendency is the mean, sometimes
referred to as the average.
§ Although they are extremely useful, measures of central tendency are
incomplete descriptors of the variety of values in a particular set of
numbers.
§ All measures of variability are concerned with depicting the “typical”
difference between the values in a set of values.
§ There are three measures of variability: frequency distribution, range, and
standard deviation.
§ Frequency and Percentage Distribution: A frequency distribution is a
tabulation of the number of times that each different value appears in a
particular set of values. The conversion is accomplished simply through a
quick division of the frequency for each value by the total number of
observations for all values, resulting in a percent, called a percentage
distribution .
§ Range: The range identifies the distance between lowest value (minimum)
and the highest value (maximum) in an ordered set of values.
Standard Deviation:
The standard deviation indicates
the degree of variation or diversity
in the values in such a way as to be
translatable into a normal or bell-
shaped curve distribution.
§ Reporting Scale Data
(Ratio and Interval
Scales): Scale data is
summarized with the
following descriptive
measures: average,
median, mode, standard
deviation, minimum, and
maximum.
Reporting Nominal or
Categorical Data:
Nominal data is
summarized with the
following descriptive
measures: frequencies,
frequency distribution,
percents, percent
distribution, and mode.
§ Values that are computed from information provided by a sample are
referred to as the sample’s statistics, whereas values that are
computed from a complete census, which are considered to be precise
and valid measures of the population, are referred to as parameters.
§ The notation used for
a percentage is p for the statistic and π for the
parameter, and the notations for the mean are ! (statistic) and "
(parameter).
§ Inference is a form of
logic in which you make a general statement (a
generalization) about an entire class based on what you have observed
about a small set of members of that class.
§ Statistical inference is a set of procedures in which
the sample size and sample statistic are used to make
an estimate of the corresponding population
parameter.
§ Two types of statistical inference are parameter Parameter
estimation and hypothesis tests. Inferential Estimation
§ A parameter estimate is used to approximate the Statistics
population value (parameter) through the use of Hypothesis
confidence intervals. Testing
§ Hypothesis testing is used to compare the sample
statistic with what is believed (hypothesized) to be the
population value prior to undertaking the study.
Parameter estimation is the process of using sample information to compute
an interval that describes the range of a parameter such as the population mean
(μ) or the population percentage (π). It involves the use of three values: the
sample statistic (such as the mean or the percentage), the standard error of the
statistic, and the desired level of confidence (usually 95% or 99%).
§ The sample statistic is usually a § The standard error is a measure
mean or a percentage. of the variability in a sampling
distribution.
§ Confidence intervals are the degree of
accuracy desired by the researcher
and stipulated as a level of confidence
in the form of a range with a lower
boundary and an upper boundary.
§ Typically, marketing researchers rely
only on the 99%, 95%, or 90% levels
of confidence, which correspond to
±2.58, ±1.96, and ±1.64 standard
errors, respectively.
§ A hypothesis test is a statistical procedure used to “accept” or
“reject” the hypothesis based on sample evidence.
 #−%
!=
Ho: μ = k &'
Ha: μ ≠ k Reject Ho if |z| > 1.96 (95%) or |z| > 2.58 (99%)

#−%
Define Ho Ho: μ ≥ k !=
&'
and Ha Ha: μ < k
Reject Ho if z < –1.64 (95%) or z < –2.33 (99%)

#−%
Ho: μ ≤ k !=
&'
Ha: μ > k
Reject Ho if z > 1.64 (95%) or z > 2.33 (99%)