Marketing Research Aaker, Kumar, Day and Leone Tenth Edition Instructor’s Presentation Slides 1

Marketing Research 10th Edition Chapter Twelve 2 Sample Size and Statistical Theory

Marketing Research 10th Edition Determining the Sample Size Ad Hoc Methods Used when a person knows from experience what sample size to adopt Used when budgetary constraints dictate the size of the sample Rule of Thumb Sample should be large enough, so that when divided into groups, each group will have a minimum sample size of 100 or more If analysis involves comparison between subgroups, sample size in each subgroup should be 20 to 50 Use disproportionate sampling if one of groups of population is relatively small Budget Constraints Researcher must decide whether sample size dictated by budget constraints allows a worthwhile study to be conducted Comparative Studies Find similar studies and use their sample sizes as a guide 3

Marketing Research 10th Edition Factors Determining Sample Size Number of groups and subgroups within the sample Value of information in the study Accuracy level required in results Cost of sample Variability of the population 4

Marketing Research 10th Edition Population Characteristics/Parameters Population Mean Normally unknown Determine value as closely as possible by taking a sample from population Population Variance Measure of population dispersion Based on degree to which a response differs from population average response The difference of each value from its mean is squared and averaged across all responses 5

Marketing Research 10th Edition Population Characteristics/Parameters 6 The population opinion on symphony starting time (7:30 P.M. on weekdays)

Marketing Research 10th Edition Sample Characteristics/Statistics 7 Sample mean ( ) is used to estimate the unknown population mean Example: A sample of symphony season-ticket holders

Marketing Research 10th Edition Sample Characteristics/Statistics (Contd.) 8 Sample mean

Marketing Research 10th Edition Sample Reliability X will vary from sample to sample As sample size (n) increases, variation in X will decrease 9 standard error of decreases as the sample size gets larger

Marketing Research 10th Edition Sampling Distribution 10 The normal distribution of Indicates probability of getting a particular sample mean

Marketing Research 10th Edition Sampling Distribution (Contd.) 11 The effect of increasing sample size on the normal distribution of

Marketing Research 10th Edition Interval Estimation varies from sample to sample The difference between the sample mean ( ) and the population mean is the sampling error Interval size depends on the confidence level the researcher wants for the interval to contain the true population mean If the population standard deviation is not known, it is necessary to estimate it with the sample standard deviation 12

Marketing Research 10th Edition Interval Estimation (Contd.) 13 Size of Interval Estimate depends on: Confidence level Population standard deviation Sample size

Marketing Research 10th Edition Sample Size Question Size of the sampling error that is desired Confidence level Expected variance 14

Marketing Research 10th Edition Determining the Population Standard Deviation Options: Use a sample standard deviation obtained from a previous comparable survey or from a pilot survey Estimate the sample standard deviation (s) subjectively 15

Marketing Research 10th Edition Proportions 16 Population variance,

Marketing Research 10th Edition Sample Size Formulas 17

Marketing Research 10th Edition Coefficient of Variation Researcher may require the sample estimate be within plus or minus G percentage points of the population value Therefore, D = G  The sample size formula may be written as: C is the Coefficient of variation 18

Marketing Research 10th Edition Stratified Sampling Useful when : ▫The population standard deviation differs by strata ▫The interview cost differs by strata Optimal allocation of sampling budget to various strata: Neyman’s solution 19 where

Marketing Research 10th Edition Allocating Sample Size to Strata 20 where