Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 9- 1 Basic Marketing Research: Using Microsoft Excel Data Analysis, 3 rd edition Alvin C. BurnsLouisiana State University Ronald F. BushUniversity of West Florida

Why Are Differences Important? Market segmentation holds that within a product market, there are different types of consumers who have dissimilar requirements, and these differences can be the bases of marketing strategies. Marketing segmentation relies on the discovery of significant differences through the application of the proper data analysis. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 13- 2

Why Are Differences Important? Continued... Using Sprint as an example, there are three ways a researcher can analyze for differences in the service Sprint customers want: Compare one group to another Compare three or more groups Compare how important one service feature is to compared to another Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 13- 3

Testing for Significant Differences Between Two Groups A categorical scale requires that the researcher compare the percentage for one group to another. A metric scale requires that the researcher compare averages from group-to-group Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 13- 4

Differences Between Percentages for Two Groups We have a sample of males and a separate sample of females who rented DVD’s, and we have two percentages: 65% of men and 40% of women chose an “Action/Adventure” movie last time they rented Are males and females different with respect to renting “Action/Adventure” DVD’s? Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 13- 5

Are males and females different with respect to renting “Action/Adventure” DVD’s? Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 13- 6

Differences Between Percentages for Two Groups, Continued... To test whether a true difference exists between two group percentages, we test the null hypothesis that the difference in their population parameters is equal to zero. The alternative hypothesis is that there is a true difference between the two group percentages (or average) that we are comparing. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 13- 7

Differences Between Percentages for Two Groups, Continued... Formula to perform the test of significance of differences between two percentages, each representing a separate group (sample): Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 13- 8

Differences Between Percentages for Two Groups, Continued... Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall 13- 9

Differences Between Percentages for Two Groups, Continued… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Differences Between Percentages for Two Groups, Continued... Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Between Two Group Percents- XL Data Analyst The menu sequence for the XL Data Analyst is Compare-2 Group Percents. We define a grouping variable as the variable that is used to identify groups that are to be compared with respect to differences. The target variable is the variable on which the groups will be compared. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Between Two Group Percents- XL Data Analyst, Continued... Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Between Two Group Percents- XL Data Analyst, Cont’d. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Differences Between Averages for Two Groups Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Differences Between Averages for Two Groups, Continued... Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Differences Between Averages for Two Groups, Continued... Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Between Two Group Averages- XL Data Analyst The menu sequence for the XL Data Analyst is Compare-2 Group Averages… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Between Two Group Averages- XL Data Analyst, Cont’d. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Between Two Group Averages- XL Data Analyst, Cont’d. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Testing for Significance Differences for More Than Two Group Averages When a researcher wants to compare the averages of MORE THAN TWO groups, analysis of variance, sometimes called ANOVA, should be used to accomplish such multiple comparisons. We want to know if a metric measured variable is different between MORE THAN TWO GROUPS… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Example: Does “service quality” vary between 4 departments in a mass merchandiser’s store? Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Why Use Analysis of Variance? When you have more than two groups, the comparisons become complicated. To compare the averages for four different groups: A, B, C, and D… …Make the following 6 comparisons- A:B, A:C, A:D, B:C, B:D, and C:D ANOVA is an efficient analysis that does all of these tests simultaneously! Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Use Using XL Data Analyst to run Analysis of Variance XL Data Analyst does the statistical interpretation of ANOVA and, if it finds that the null hypothesis is not supported at the 95% level of confidence, it provides a table that shows you the various group averages and identifies which ones are significantly different… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Among More Than Two Group Averages- XL Data Analyst The menu sequence for the XL Data Analyst is Compare-3+ Group Averages… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Among More Than Two Group Averages- XL Data Analyst, Continued… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Difference Among More Than Two Group Averages- XL Data Analyst, Continued… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Flow Chart of Differences Analyses for Groups Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Testing for Significant Differences Between the Averages of Two Variables With this analysis, the entire sample is used, but two different variables are compared. Of Course, the two variables should be measured on the same metric scale; otherwise, you are comparing apples to oranges. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Differences Between the Averages of Two Variables- XL Data Analyst The menu sequence for the XL Data Analyst is Compare-2 Variable Averages… Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Differences Between the Averages of Two Variables- XL Data Analyst, Continued.. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

Determining the Significance of the Differences Between the Averages of Two Variables- XL Data Analyst, Cont. Copyright ©2010 Pearson Education, Inc. publishing as Prentice Hall

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