02/10/2024

Marketing Studies
(Market research)

Quantitative
Research &
Hypotheses testing

October 2024 Dr. Richard McFarland

QUANTITATIVE
Research

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Data you Data you

buy/get generate

QUANTITATIVE
Research

The nature of
quantitative
research?
Structured data collection methods: Quantitative
market research typically involves collecting data through
structured quantitative research methods like surveys,
experiments, or other techniques that allow for the
collection of objective and measurable data. This
structured approach helps ensure that the data collected
is consistent and reliable.

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Quantitative market research can be

used to answer a wide range of
questions, such as:
• What are the most popular products or
services in a particular market?
Types of • How much are people willing to pay for
a particular product or service?
Questions
• What factors influence consumer
purchasing decisions?
• How satisfied are customers with a
particular product or service?
• What is the market share of different
companies in a particular industry?

• Experiments
Examples of
• Survey Research
Quantitative
• Secondary Data Analysis
Methods
• Observational Studies

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• What of the following factors influence

your decision to purchase coffee?
Types of • On a scale of 1‐10, how likely are you to
Questions recommend our coffee to a friend?

• What is your age?

• Large sample sizes: To ensure statistical significance, quantitative market

research typically requires large sample sizes. This means that a large number of
individuals need to be surveyed or studied to ensure that the data collected is
representative of the broader population.
• Statistical analysis: Quantitative market research relies heavily on statistical
analysis to identify patterns and correlations in the data. This involves using
techniques like regression analysis, correlation analysis, and hypothesis testing
to draw conclusions from the data collected.
• Objectivity: The goal of quantitative market research is to gather objective and
Advantages of unbiased data that can be used to make informed decisions. To achieve this,
researchers need to ensure that their methods are objective and that the data
Quantitative •
collected is free from bias.
Replicability: One of the strengths of quantitative market research is that it is
Research replicable. This means that other researchers can use the same methods to
collect and analyze data, which allows for the results to be verified and validated
over time.
• Generalizability: Quantitative market research aims to gather data that is
representative of the broader population. This means that the insights and
conclusions drawn from the data can be generalized to the broader population
with a certain level of confidence.
• Quantification: Quantitative market research involves quantifying data using
numerical measurements. This allows for the data to be easily analyzed and
compared, and for statistical techniques to be used to draw insights from the
data.

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Hypotheses
Testing

• A hypothesis is an educated guess or

proposed explanation for a phenomenon,
based on some initial observations or
data. It is a tentative statement that can
be tested and potentially proven or
disproven through further investigation
and experimentation.
Hypotheses • Hypothesis is often used in scientific
research to guide the design of
experiments and the collection and
analysis of data. It is an essential element
of the scientific method, as it allows
researchers to make predictions about
the outcome of their experiments and to
test those predictions to determine their
accuracy.

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• There are different philosophies of

science.
• Most modern scientists are Logical
Positivists. Key assumptions:
• You can observe things without influencing
Philosophy of them
Science • You can never prove anything
• You can disprove things

• Thus, you technically cannot prove a

hypothesis, only disprove one.

• Technically we thus make a null

hypothesis
H0 ‐> Null Hypotheses
• You hope to reject the null.
• If you fail to reject the null, then H‐Alt is
The Null false.
Hypothesis
Ha ‐> Alternative Hypotheses
• While you can falsify a hypothesis, you
can never accept a hypothesis—You
simply “Fail to reject the hypothesis.”

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H0 ‐> Hypotheses
• In practice, we tend to simply specify the
hypothesis we want to test, and test that,
The rather than specify a null and an
Alternative alternative hypothesis.
Hypothesis • Philosophically however, we can
technically never accept that hypothesis.
We often say that the hypothesis was
supported, or again more formally that
we failed to reject that hypothesis.

• Hypotheses generally pertain to

population parameters or characteristics
Hypotheses rather than to sample characteristics. It is
the population, not the sample, that we
want to make an infernece about from
limited data

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• Karen, product manager for a line of

apparel, to introduce the product line
into a new market area
• Survey of a random sample of 400
households in that market showed a
Hypothesis mean income per household of
Example $30,000.Karen strongly believes the
product line will be adequately profitable
only in markets where the mean
household income is greater than
$29,000. Should Karen introduce the
product line into the new market?

• To reach a final decision, Karen has to

make a general inference (about the
population) from the sample data
• Criterion‐‐ mean income across across all
Hypothesis households in the market area under
Example consideration
• If the mean population household
income is greater than $29,000, Karen
should introduce the product line into
the new market

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• Karen’s decision making is equivalent to

either accepting or rejecting the
hypothesis:
• The population mean household income in
Hypothesis the new market area is greater than $29,000
Example  ‐> Population Mean
H0:   $29,000
Ha:   $29,000

Experiments

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• An Experiment is research approach in

which one variable is manipulated and the
effect on another variable is observed.

•Key Variables
•Independent: variables one controls directly such as
price, packaging, distribution, product features, etc.

• Dependent: variables one does not directly control such

Experiments as sales or customer satisfaction - (might control them by
manipulating the independent variable)

• Treatment: the independent variable manipulated during

the experiment to measure its effect on the dependent
variable

• Extraneous: Factors one does not control but has to live

with such as the weather

• Research designed to determine

Causal whether a change in one variable likely
caused an observed change in another.
Research

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Concomitant
Variation:
• A statistical relationship between variables
• Evidence of an association (when the I.V. changes so does
the D.V.)

Appropriate Time Order of

Occurrence:

Causal • Change in an independent variable occurred

before an observed change in the dependent
Research variable
• Temporal ordering of variables
I.V.  D.V. not D.V.  I.V.

Elimination of Other Possible Causal Factors:

• “If you eliminate the impossible, whatever remains,

however improbable, must be the truth.” Sherlock
Holmes

• Laboratory
• Experiments conducted in a controlled
setting.

Experiments • Field
• Tests conducted outside the laboratory in an
actual environment, such as a marketplace.

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• Internal Validity
• The extent to which competing explanations
for the experimental results observed can be
ruled‐out.

Experimental • External Validity

• The extent to which causal relationships
Validity measured in an experiment can be
generalized to outside persons, settings, and
times.

• History: Intervention, between the beginning

and end of an experiment, of outside variables
that might change the dependent variable.
• Maturation: Changes in subjects occurring
during the experiment that are not related to
Examples of the experiment but which might affect subjects’
response to the treatment factor.
some threats • Selection Bias: Systematic differences
to internal between the test group and the control
group due to a biased selection process.
Validity
• Mortality: Loss of test units or subjects during
the course of an experiment which might result
in a non‐representativeness.

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• The presence of one or more control

groups

• The random assignment of units to

various experimental and control groups
True • Random assignment distributes the
Experimental sample units chosen for a study to
various groups on a strictly objective
Design basis so that the group compositions can
be equivalent before an experiment is
started

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