MARKETING RESEARCH

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 MARKETING RESEARCH

MARKETING RESEARCH is the function which

links the consumer , customer, and public to the marketer

through information –

information used to identify and define marketing opportunities

and problems;

generate, refine , and evaluate marketing actions ;

monitor marketing performance ; and

improve understanding of marketing as a process.

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 MARKETING RESEARCH

MARKETING RESEARCH specifies the

information required to address these
issues ; designs the method for
collecting information ; manages and
implements the data collection process;
analyzes the results ; and communicates
the findings and their implications.

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Why Market Research?
It is usually said that if marketing would be a train, then market research would be the locomotive. In other
words, market research should ideally be the starting point of any marketing exercise.

Conducting any marketing exercise - be it related to pricing, promotion or distribution of a product or service,
without researching the potential market is as sensible as setting out to sell sand in the Sahara Desert.

Market research provides the answers to all the questions that generally occupy the minds of marketers, at
every stage of the marketing process.
Will there be a demand for my product or service ?

What should be the ideal price of my offering - one that ensures that I earn the maximum profit ?

Should I place my product only in urban markets or distribute even in the rural areas ?

Is the fourfold growth in my sales figures a consequence of our latest television commercial ?

How satisfied are our customers with the after sales services we provide ?

It's really crucial to understand your target market before undertaking any marketing exercise, unless you
don't mind risking your hard-earned money and precious time on activities that might not get you the results
you want.

Simply put, ignoring market research before marketing is synonymous with firing a shot in a pitch dark room,
and still hoping that the bullet hits the bulls eye.
_________________________________________________________________________________
Source: IMRB [http://www.imrbint.com/market/index.html]
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 Independent Variables Dependent Variables
(Causes) (Effects)

Marketing Mix (Controllable) Behavioral Response

[Product, Price, Place, [ Awareness, Knowledge,
Promotion Decisions] Liking, Preference, Intent -to-
buy, Purchase]

Situational Factors Performance measures

(uncontrollable)
Sales, Market share, Cost,
Demand, Competition, Legal, Profit,ROI, Cash Flow,
Economic Climate, Earning per share,Image
Technological,Govt.'s
Regulation, Internal
Resources to the organization MODELS OF MARKETING SYSTEM
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DECISION MAKING PROCESS
MARKETING SYSTEM
Problem/ Need recognition
Search for alternatives Marketing Mix Behavioral
Evaluate the alternative courses Response
of action Situational
Factors
Select a course of action
Performance measures
Implement and modify

Information Inputs

Management experience and judgement

Marketing Research System

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MARKETING MANAGEMENT PROCESS
 MR PROCESS

1: Problem Definition

2: Determine Research Design & Sources of Data

3: Develop the Data Collection Procedure

4: Design the sample

5: Collect, Process and Analyze the Data

6: Report preparation & presentation

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 PROBLEM DEFINITION

It may be

• Problem identification research

• Problem solving research

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The Process of Defining the Problem and Developing an Approach
Tasks involved

Discussions Interviews Secondary Quantitative

with decision makers with experts data analysis research

Environmental context of the problem

Step 1: Problem Definition

Management Decision problem

Marketing Research Problem

Step 2: Approach to the Problem

Objective Analytical model Research Hypothesis Characteristics /

factors influencing
theoretical Descriptive questions research design
foundation Mathematical
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Step 3: Research Design
 MR / MD PROBLEM

E.g. MANAGEMENT DECISION PROBLEM:

WHAT SHOULD BE DONE TO IMPROVE THE
PATRONAGE OF THE STORE ?

MARKETING RESEARCH PROBLEM:

DETERMINE THE RELATIVE STRENGTHS
AND WEAKNESS OF THE STORE, VIS-À-VIS
OTHER MAJOR COMPETITORS, WITH
RESPECT TO FACTORS THAT INFLUENCE
STORE PATRONAGE.

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 MR / MD PROBLEM
MD problem: asks what the decision maker wants to know- action
oriented- focuses on symptoms
MR problem : Asks what information is needed and how it should
be obtained – information oriented – focuses on the causes.

E.g. Should a new product be introduced?

Determine consumers preference & purchase intention
for the proposed new product.

Should the advertisement campaign be changed?

Determine the effectiveness of current advertisement

campaign. 11
 Example
• Management Problem
– What price should we charge for our new product?
• Research Problem [can be …]
– What are our costs of production and marketing ?
– What are our pricing objectives and position in the market?
– What price does similar types of products sell for?
– What is the perceived value of our product in the marketplace?
– Are there any norms or conventional practices in the marketplace
(e.g., customary prices, continual discounting)
• Research Objectives [can be …]
– To assess the costs involved in producing and selling our product
– To determine corporate objectives and their implications for
pricing
– To examine current prices for direct and indirect competition
– To determine potential customer reaction to various prices and
their perception of the benefits of owning the product
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Case 2: How Communication Worked

Joseph E.Seagram and Sons, Inc. was marketing a new wine and the VP [Mktg]
requested a survey of the US wine market.

Survey objective: Determination of advertising target market groups,

measurement of image of the brand compared with other wines, development of
advertising copy strategy, determination of optimal media mix.

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 RESEARCH DESIGN

A framework for conducting the marketing research project. It

specifies the details of the procedures necessary for obtaining
the information needed to structure and/or solve marketing
research problems.
Longitudinal
Exploratory

Descriptive
Conclusive
Cross-sectional
Causal

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 Difference between Exploratory & Conclusive Research
EXPLORATORY CONCLUSIVE

OBJECTIVE To provide insights and To test specific

understanding hypothesis & examine
relationships
CHARACTERISTICS •Information needed is •Information needed is
defined only loosely clearly defined.
•Research process is •Research process is
flexible and unstructured formal & structured.
•Sample is small and non- •Sample is large and
representative representative
•Analysis of primary data •Data analysis is
is qualitative quantitative.
FINDINGS / RESULTS Tentative Conclusive

OUTCOME Generally followed by Findings used as input

further exploratory / into decision making.
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conclusive research
 Comparison of research designs
Exploratory Descriptive Causal
Objective Discover ideas Mkt characteristics Cause &
& insights effect relation

Characteristics Flexible Marked by prior Manipulation

Versatile formulation of of 1/more
specific hypothesis independent
variables
Methods Expert survey, 2ndary data, Experiments.
Pilot survey, survey, panels,
Secondary observational data.
data,
qualitative
research 18
 EXPLORATORY RESEARCH DESIGN

• Secondary data analysis

• Primary data ( qualitative research)

QUALITATIVE RESEARCH

Direct (non-disguised) Indirect (disguised)

• Focus Group • Projective Techniques

• Depth Interview

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FOCUS GROUP
INTERVIEWS

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 Characteristics of Focus Group
It is an interview conducted by a trained moderator in a non-
structured and natural manner with a small group of
respondents.
Group Size 8 to 12
Group Composition homogeneous, respondents prescreened
Physical Setting relaxed, informal atmosphere
Time duration 1 –3 hrs
Moderator observational, interpersonal and
communication skills of the moderator.

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EXPLORATORY RESEARCH TECHNIQUES

• Depth Interview

A single respondent is probed by a skilled interviewer

to uncover underlying motivation, belief, attitude and
feelings on a topic.

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EXPLORATORY RESEARCH TECHNIQUES

Projective Techniques
• Association Technique- respondent is presented with
a stimulus and asked to respond with the first thing
that comes to mind.

Word association test :

Location _______
Shopping _______
Shopping and eating _______
Parking _______
Quality _______
Price _______
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 EXPLORATORY RESEARCH TECHNIQUES

Projective Techniques
• Completion Technique – Requires respondent to
complete an incomplete stimulus situation.
Sentence completion :
Godrej brand is my choice because _____________________
When it comes to shopping I __________________________
Titan is a brand for _________________________________

Story completion:

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 EXPLORATORY RESEARCH TECHNIQUES

Projective Techniques
Construction Technique - Respondents are required to construct a
response in the form of a dialogue / description.
Picture response :Thematic Appreciation test (TAT)- pictures
Cartoon tests:
Expressive Techniques
-visual/ verbal situations – relate feeling of
other people to the situation.
E.g. role play, third person test.
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 DESCRIPTIVE RESEARCH
A type of research used for describing market characteristics / functions.
E.g. percentage of heavy users of department stores
perception of product characteristics.
It requires a clarification of the 6Ws –
Who is target customer
What information to be attained
When to attain the information
Where to contact the respondents
Why are we obtaining these information
Way in which we are to get these information.
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 DESCRIPTIVE RESEARCH

CROSS-SECTIONAL LONGITUDINAL

CROSS-SECTIONAL - (collection of information from any

given sample only once)

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 DESCRIPTIVE RESEARCH

CROSS-SECTIONAL LONGITUDINAL
(collection of info from any
given sample only once)

SINGLE CROSS-SECTIONAL ( one sample)

MULTIPLE CROSS-SECTIONAL (2/more samples)

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SINGLE CROSS-SECTIONAL STUDY

AGE 1950
8-17 52.9 Sam
pl e 1
18-27 45.2
28-37 33.9
38-47 23.2
48+ 18.1

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 MULTIPLE CROSS-SECTIONAL STUDY
[COHORT ANALYSIS]

AGE 1950 1960 1970 1980

8-17 52.9 62.6 73.2 81
18-27 45.2 60.7 76 75.8
28-37 33.9 46.6 67.7 71.4
38-47 23.2 40.8 58.6 67.8
48+ 18.1 28.8 50 51.9

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Single cross-sectional study
 LONGITUDINAL STUDY
(collection of info. from a fixed sample of population element
measured repeatedly)

CASE : WOMEN GOLFERS

Findings :
• More golf events be shown in television
• Didn’t prefer reformulated version of men’s apparel
• Apparel should be attractive and functional
• Psychological factor associated with apparel
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 REL. ADVANTAGE & DISADVANTAGE OF
LONGITUDINAL & CROSS- SECTIONAL STUDY

BRAND SURVEY 1 SURVEY 2

A 200 200

B 300 300

C 500 500

TOTAL 1000 1000

Cross – sectional data

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 REL. ADVANTAGE & DISADVANTAGE OF
LONGITUDINAL & CROSS- SECTIONAL STUDY
Brand in Brand in Period 2
Period 1 A B C TOTAL

A 100 50 50 200
(50%)
B 25 100 175 300
(33.33%)
C 75 150 275 500
(55%)
TOTAL 200 300 500 1000
TURNOVER TABLE / BRAND SWITCHING TABLE 33
 Relative Advantages & Disadvantages of
Longitudinal & Cross-Sectional Designs

Evaluation Criteria Cross- Sectional Longitudinal

Design Design
Detecting change - +

Large amount of data - +

collection
Accuracy - +
Representative + -
sampling
Response Bias + -

Note : + indicates a relative advantage over the other design; whereas – indicates a
relative disadvantage.
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 METHODS OF CONDUCTING DESCRIPTIVE
RESEARCH

• QUANTITATIVE (2ndary) DATA ANALYSIS

• SURVEY ( telephonic, personal, mail, electronic interviewing)
• PANEL ( Longitudinal Study)
• OBSERVATION

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 SURVEY

Depending upon factors like information requirement, budgetary

constraint, respondent characteristics, one/more method can be
chosen.

E.g. BLUE CROSS ( telephonic interview – mail)

Statistics: 10000 (phone)
650 (mail)
405 (response)
Result :23% print, 41% TV, 40% radio

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 OBSERVATION

STRUCTURED UNSTRUCTURED
Researcher specifies in details Researcher monitors all aspects
what is to be observed and how of the phenomena without
measurement are to be specifying details in advance
recorded.
Observer bias less Observer bias more. Findings
treated as hypothesis
Reliability data more Reliability data less
Used when problem has been Used when key component of
identified fully the problem has yet to be
formulated.

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 OBSERVATION

DISGUISED / UNDISGUISED OBSERVATION

NATURAL / CONTRIEVED OBSERVATION

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METHODS USED IN OBSERVATION METHOD

• PERSONAL
• MECHANICAL
• CONTENT ANALYSIS
• TRACE ANALYSIS
• AUDIT

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 CAUSAL RESEARCH

Its appropriate for

• understanding which variable is the cause and
which effect.
• determine the nature of relationship between
causal variable and the effect to be predicted.

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 CONDITION FOR CAUSALITY

1. CONCOMITANT VARIATION – the extent to which cause (X) and effect (Y)

occur together or vary together in the way predicted by hypothesis under

consideration.

2. TIME ORDER OF OCCURRENCE OF VARIABLES – cause occurs

before effect.

3. ABSENCE OF OTHER POSSIBLE CAUSAL FACTORS.

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 EXPERIMENTS

• LABORATORY / CONTROLLED
• NATURAL / FIELD

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 LABORATORY Vs. FIELD EXPT.

FACTORS LABORATORY FIELD

CONTROL High Low
EXTERNAL VALIDITY Low High
INTERNAL VALIDITY High Low
NO. OF TEST UNITS Small Large
DURATION OF EXPERIMENT Short Long
EXPENSE Low High
EASE OF IMPLEMENTATION High Low
DEMAND ARTIFACTS High Low

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 TEST MARKETING

• STD. TEST MARKET

• CONTROLLED TEST MARKET

• SIMULATED TEST MARKET

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THE MEASUREMENT PROCESS

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NUMBER SYSTEM CHARACTERISTICS

• UNIQUE

• ORDER

• DIFFERENCE

• RATIO

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 TYPES OF SCALES

•NOMINAL SCALE

•ORDINAL SCALE

•INTERVAL SCALE

•RATIO SCALE

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SCALE NUMBER SYSTEM MARKETING PERMISSIBLE
PHENOMENA STATISTICS
NOMINAL Unique definition of Brands Percentages
numerals (0,1,2,……..9) Male-Female Mode
Store Types Binomial test
Sale Territories Chi-square test
ORDINAL Order of numerals Attitudes Percentiles
(0<1<2<…<9) Preferences Median
Occupations Rank-Order
Social classes correlation
INTERVAL Equality of differences Attitudes Range
(2 –1 =7-6) Opinions Mean
Index numbers Standard Deviation
Product-Moment
Correlation
RATIO Equality of ratios (2 / 4 Ages Geometric Mean
= 4 / 8) Costs Harmonic Mean
Number of Coefficient of
customers variation
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Sales (units/dollars)
 MEASUREMENT SCALES

COMPARATIVE NON - COMPARATIVE

continuous itemized

Paired Rank Constant sum

comparison order
likert semantic

stapel

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 PAIRED COMPARISON SCALING

Given below are 6 pairs of shampoo brands. Indicate which of the two
brands of shampoo in the pair you would prefer for personal use.

A B C
A 0 1
B 1 1
C 0 0

* 0 means row preferred over column brand

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 RANK ORDER PREFERENCE

Given are 3 brands of shampoos. Rank the brands in the order

of your preference.

A
B
C

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 CONSTANT SUM SCALE

Allocate 100 points among the attributes based on the importance you
attach to each attribute.

Segment 1
Mildness 10
Price 20
Packaging 10
Fragrance 20
Moisturizing 10
Cleansing power 30
____
100 53

------
 CONTINUOUS RATING
SCALE
How would you rate brand A as a soap?

Best ----------------------------------------- Worst

Best -------------X-------------------------- Worst

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Brand A is a high quality brand.

Strongly disagree
Disagree
Likert Scale
Neither agree nor disagree
Agree
Strongly agree

Strongly disagree
Disagree
Somewhat disagree Semantic-differential Scale
Neither agree nor disagree
Agree
Somewhat agree 55
Strongly agree
Brand A is a quality brand.

-1
-2
Stapel scale
-3
-4
-5

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 QUESIONNAIRE DESIGN PROCESS
Specify the information needed.

Specify the type of interviewing method

Determine content of individual questions

Design questions to overcome the respondent’s inability and unwillingness to answer.

Decide on the question structure

Decide on the question wording

Identify the Form and Layout

Reproduce the Questionnaire

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Eliminate bugs by pre-testing
 Determine content of individual questions

• IS THE QUESTION NECESSARY ?

Neutral questions
Duplicate questions to assess reliability & validity.

• ARE SEVERAL QUESTIONS NEEDED INSTEAD OF ONE ?

Do you think Cola is a tasty and refreshing soft drink?
Will you buy Nokia handset ?

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 Design questions to overcome the respondent’s inability
and unwillingness to answer.
IS RESPONDENT INFORMED?
Male member of the house may not be aware of the grocery expense per
month.

CAN RESPONDENT REMEMBER?

Which are the restaurants you visited in the last 6 months?

CAN RESPONDENT ARTICULATE?

What is the difference in ambience of Hyatt and Taj Bengal?

SENSITIVE INFORMATION
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What is your monthly household income?
 CHOOSING QUESTION STRUCTURE

UNSTRUCTURED QUESTION :
What are your intentions regarding purchasing a car?

STRUCTURED QUESTION :
• MULTIPLE CHOICE QUESTIONS –

Do you intend to buy a new car within next 6 months?

________definitely will not buy
________probably will not buy
________undecided
________probably will buy
________definitely will buy
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•ORDER OR POSITION BIAS:
Which factors are more crucial in choosing a restaurant?

Price Service

Quality Location

Location
Quantity of food

Quantity of food Ambience

Ambience Quality

Service Price

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•DICHOTOMOUS QUESTIONS:
Do you intend to buy a car in the next 6 months?
___________ Yes ___________ No

Decide on the question wording

• DEFINE THE ISSUE
Which brand of shampoo do you use generally? [incorrect]
Which brand/s have you personally used during the last month?
• USE ORDINARY WORDS
Is distribution of soft drink adequate? [incorrect]
Are soft drinks readily available when you want to buy them?
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• USE AMBIGUOUS WORDS
How frequently do you visit a restaurant?
_____Never ___Occasionally ____Sometimes ____Often ___Regularly
• BIASING QUESTIONS
Do you think Nokia is a reliable set?
• IMPLICIT ALTERNATIVES
Do you like to fly when traveling short distances? [incorrect]
When traveling short distances do you like to fly or drive?
• IMPLICIT ASSUMPTIONS
Would you favour a balanced budget? [incorrect]
Would you favour balanced budget if it leads to increase in tax?

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 ERRORS

SAMPLING ERROR – sample selected is imperfect

representation of the population.

NON-SAMPLING ERROR :
Researcher Error ( surrogate , measurement, population
definition, data analysis error)
Interviewer Error (respondent selection, questioning,
recording, cheating error)
Respondent Error ( inability, unwillingness error)

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 SAMPLE DESIGN

SAMPLE VS CENSUS
SAMPLE CENSUS
Budget Small Large
Time available Short Long
Population size Large Small
Variance in characteristics Small Large
Cost of sampling errors Low High
Cost of non-sampling errors High Low
Nature of measurement Destructive Nondestructive
Attention to individual cases Yes No

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 SAMPLING
TECHNIQUES

NON
PROBABILITY
PROBABILITY

SIMPLE
CONVENIENCE JUDGEMENTAL QUOTA SNOWBALL SYSTEMATIC STRATIFIED CLUSTER
RANDOM
SAMPLING SAMPLING SAMPLING SAMPLING SAMPLING SAMPLING SAMPLING
SAMPLING

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Convenience sampling

A B C D E It attempts to obtain a sample of

convenient elements. The
1 6 11 16 21 selection is left to the interviewer.
2 7 12 17 22 E.g. mall intercept interviews,
tear out questionnaire in
3 8 13 18 23 magazines, etc.
4 9 14 19 24
5 10 15 20 25

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Judgmental sampling

A B C D E A form of convenience sampling

in which population elements are
1 6 11 16 21 selected based on judgment of
the researcher.
2 7 12 17 22
E.g. test market to determine
3 8 13 18 23 potential of new product, expert
4 9 14 19 24 witness used in court, etc.

5 10 15 20 25

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Quota sampling

A B C D E It is a 2 stage restricted
judgmental sampling.
1 6 11 16 21
Stage 1: develop quota of
2 7 12 17 22
population elements
3 8 13 18 23 Stage 2: sample elements from
4 9 14 19 24 each quota are selected based on
convenience/ judgment.
5 10 15 20 25

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Snowball sampling

A B C D E An initial group of respondents

are selected randomly and
1 6 11 16 21 subsequent respondents are
2 7 12 17 22 selected based on referrals
provided by initial respondents.
3 8 13 18 23 It is used in industrial buyer-
seller relationship.
4 9 14 19 24
5 10 15 20 25

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 PROBABILITY SAMPLING TECHNIQUES

Simple random sampling – each element in the population has a known and equal
probability of occurrence/ selection. A sampling frame is compiled and elements are
selected using random numbers.

A B C D E
1 6 11 16 21
2 7 12 17 22
3 8 13 18 23
4 9 14 19 24
5 10 15 20 25

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 SYSTEMATIC SAMPLING

The samples are chosen by selecting a random starting point and then
picking every i th element in succession from the sampling frame.

A B C D E
1 6 11 16 21
2 7 12 17 22
3 8 13 18 23
4 9 14 19 24
5 10 15 20 25

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 STRATIFIED SAMPLING

A 2 step process to partition the population into sub-population/ strata.

Elements are selected from each stratum by simple random sampling.

A B C D E Elements within the strata are

homogeneous but 2 strata are
1 6 11 16 21 heterogeneous.
2 7 12 17 22 E.g.demographic characteristics,
size of firm, industry type, customer
3 8 13 18 23 type.
4 9 14 19 24
5 10 15 20 25

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 CLUSTER SAMPLING

The target population is divided into mutually exclusive and collectively exhaustive
sub-population called clusters. A random sample of clusters is selected based on
probability sampling technique. For each selected cluster , either all elements are
included or sample of elements are drawn probabilistically.

Elements within a cluster should be heterogeneous But

A B C D E cluster themselves should be homogeneous. Each
1 6 11 16 21 cluster is a small scale representation of the population.

2 7 12 17 22 Only a sample of subpopulation / cluster is chosen in

cluster sampling (unlike stratified where all clusters are
3 8 13 18 23 selected).
4 9 14 19 24 Objective of cluster is increase sampling efficiency by
reducing cost. Objective of stratified is to increase
5 10 15 20 25 precision w.r.t homogeneity and heterogeneity.

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CHOOSING B/W PROBABILITY & NON-PROBABILITY SAMPLING

Factors Non-probability Probability

sampling sampling
Magnitude of exploratory Conclusive
error
Research Large non-sampling Large sampling
error error
Population Homogeneous (low) Heterogeneous
variability (high)
Statistical Unfavorable Favorable
consideration
Operational Favorable Unfavorable
consideration

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 DATA ANALYSIS
Charts/ graphs
Frequency, mean, median, mode, deviation, covariance
Hypothesis testing
Correlation and Regression analysis
ANOVA/ ANCOVA
Cross-tabulation
Factor analysis
Cluster analysis
Conjoint analysis
Discriminant & Logit analysis

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REPORT PREPARATION
1. Title page
2. Letter of authorization
3. Acknowledgement
4. Table of contents
5. List of tables/ graphs/ appendices
6. Executive summary
7. Problem definition
8. Approach to the problem
9. Research design
10. Data analysis
11. Results
12. Limitations
13. Recommendations and conclusion
14. Exhibit – questionnaire 77
15. Bibliography