Course: Research for Marketing Decisions Session 6-

Descriptive Research Design,

Causal Research Design and
Test Markets

Instructor: Vaibhav Chawla

Email: vaibhavchawla@iitm.ac.in
Descriptive Research Design

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Definition

Descriptive study determines and

reports the way things are. It has
no control over what it is, and it
can only measure what already
exists.

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Uses of Descriptive Research
1a.Describing the market (customers)
characteristics.
- What are the demographics of
buyers of Smart phones?
- What are the psychographics of
buyers of Smart phones?
- Does the profile of Smart phone
buyers differ from buyers of
Ordinary phones?
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Uses of Descriptive Research
1b.Describing the buyer perceptions
of product characteristics.
- In Smart phone buyers’ opinions,
what are the most important features
in Smart phones?
- What are the Smart phone buyer
opinions about Wi-Fi connectivity
feature?

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Uses of Descriptive Research

1c. Estimating the percentage of units

in a specific population exhibiting a
certain behavior
- Estimating the market size of
Smart phone buyers
- Estimating the market share of
Samsung Smart phones.

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Uses of Descriptive Research
2. Determining the degree to which market
(customers) variables are associated with
output of interest such as sales, profit,
intention to purchase.
- Is there an association between
age/income and purchase of Smart
phone?
- Is there an association between
consumer innovativeness and
purchase of Smart phone?
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Uses of Descriptive Research
3. Making predictions about the occurrence
– the timing, likelihood, and frequency –
of various marketing phenomena
- Using the findings from the association
of income and purchase of Smart
phone (suppose it is positive), the
company will be able to predict that high
income individuals are likely to buy Smart
phone, and thus the company will target
high income individuals.
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Methods

Methods of
Descriptive
Study

Survey Observation

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Survey Research

•Respondents are asked questions

regarding their behaviour,
intentions, attitudes, awareness,
motivations, and demographics and
lifestyle characteristics
•Typically, the questioning is
structured

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 A Classification of Survey Methods
Fig. 6.1
Survey
Methods

Telephone Personal Mail Electronic

In-Home Mall Intercept Computer-Assisted

E-mail Internet
Personal Interviewing

Traditional Computer-Assisted
Mail Interview Mail
Telephone Telephone Interviewing
Panel
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Telephone Survey
• Less expensive
• Can work from a central
location
• People more accessible
by telephone
• Can reach a large
geographical area
• People may respond
more candidly to sensitive
questions by phone

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Personal Survey
• More valid because responses are
more reliable
• Greater percentage of returns
• Interviewer tends to improve with
experience
• Do not inject your own biases
• To get good information, you must
ask good questions

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Mail Survey
• Questionnaire is developed and
mailed to pre-selected
respondents who return the
completed surveys by mail
• Mail interview package consists
of the outgoing envelope, cover
letter, questionnaire, return
envelope
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Electronic Survey
E-mail interviews
• A survey using plain text which is e-mailed for
the respondent to read, complete and return

Internet interviews
• Use HTML to write the questionnaire.
• Survey can be found on the web or emailed to a
potential respondent
• Can contribute to higher quality data

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Comparative Evaluation of Survey Methods

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Observation Based Methods

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Observational
• Data consists of
observations of
people or programs
• Can take place over
weeks or months
• Time consuming
• Requires
considerable
training

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Observation Methods
Structured vs. Unstructured

• For structured observation, the researcher

specifies in detail what is to be observed and how
the measurements are to be recorded, e.g., an
auditor performing inventory analysis in a store.

• In unstructured observation, the observer

monitors all aspects of the phenomenon that
seem relevant to the problem at hand, e.g.,
observing children playing with new toys.

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Observation Methods
Disguised vs. Undisguised

• In disguised observation, the respondents are

unaware that they are being observed. Disguise
may be accomplished by using one-way mirrors,
hidden cameras, or inconspicuous mechanical
devices. Observers may be disguised as shoppers
or sales clerks.

• In undisguised observation, the respondents are

aware that they are under observation.

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Observation Methods
Natural vs. Contrived

• Natural observation involves observing

behavior as it takes places in the
environment. For example, one could
observe the behavior of respondents eating
fast food at Burger King.

• In contrived observation, respondents'

behavior is observed in an artificial
environment, such as a test kitchen.
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 A Classification of Observation
Methods
Fig. 6.3

Classifying
Observation
Methods

Observation Methods

Personal Mechanical Audit Content Trace

Observation Observation Analysis Analysis

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Observation Methods
Personal Observation
• Researcher observes and records
actual behaviour as it occurs

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Observation Methods
Mechanical Observation
Do not require respondents' direct participation.
– The AC Nielsen audimeter

– Turnstiles that record the number of people

entering or leaving a building.

– On-site cameras (still, motion picture, or video)

– Optical scanners in supermarkets

Do require respondent involvement.

– Eye-tracking monitors

– Pupilometers

– Psychogalvanometers

– Voice pitch analyzers

– Devices measuring response latency

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Observation Methods
Audit
• Researcher collects data by
examining physical records or
performing inventory analysis
• Data is collected personally by the
researcher
• Data are based upon counts

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Observation Methods
Content Analysis
• Appropriate when observing
communication, rather than behavior
Examples
• Observing words used in newspapers
• How woman are portrayed in advertising
over the years
• Identifying themes from in-depth
interviews

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Observation Methods
Trace Analysis
• Data collection is based on physical traces,
or evidence, of past behaviour

Examples
• Erosion of tiles or carpet to measure traffic
patterns
• Fingerprints on magazine to gauge ad
popularity
• Internet users leave traces of websites visited
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 Comparative Evaluation of Observation
Methods
Table 6.3

Criteria Personal Mechanical Audit Content Trace

Observation Observation Analysis Analysis Analysis

Degree of structure Low Low to high High High Medium

Degree of disguise Medium Low to high Low High High
Ability to observe High Low to high High Medium Low
in natural setting
Observation bias High Low Low Medium Medium
Analysis bias High Low to Low Low Medium
Medium
General remarks Most Can be Expensive Limited to Method of
flexible intrusive commu- last resort
nications

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Comparison of Survey and Observation
Methods
Relative Advantages of Observation
• Measures actual behaviour
• No interviewer bias
• Useful when respondent is unaware/unable to
communicate feelings

Relative Disadvantages of Observation

• Little is known about the underlying motives,
beliefs, attitudes, and preferences
• Time consuming and expensive
• Borders on being unethical

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Experimental (or Causal) Research Design
and
Test Markets

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Criteria for Establishing Causal
Relationships
• Concomitant variation is the extent to which a
cause, X, and an effect, Y, occur together or vary
together in the way predicted by the hypothesis
under consideration.
• The time order of occurrence condition states that
the causing event must occur either before or
simultaneously with the effect; it cannot occur
afterwards.
• The absence of other possible causal factors
means that the factor or variable being investigated
should be the only possible causal explanation.

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Validity in Experimentation

• Internal validity refers to whether the manipulation

of the independent variables or treatments actually
caused the observed effects on the dependent
variables. Control of extraneous variables is a
necessary condition for establishing internal validity.

• External validity refers to whether the cause-and-

effect relationships found in the experiment can be
generalized. To what populations, settings, times,
independent variables, and dependent variables
can the results be projected?

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Extraneous Variables Pose Threat to
Internal Validity
• History (HS) refers to specific events that are
external to the experiment but occur at the same time
as the experiment.
• Maturation (MA) refers to changes in the test units
themselves that occur with the passage of time.
• Testing effects are caused by the process of
experimentation. Typically, these are the effects on
the experiment of taking a measure on the
dependent variable before and after the presentation
of the treatment.
• The main testing effect (MT) occurs when a prior
observation affects a latter observation.

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 Extraneous Variables Pose Threat to
Internal Validity
• In the interactive testing effect (IT), a prior
measurement affects the test unit's response to the
independent variable.
• Instrumentation (I) refers to changes in the measuring
instrument, in the observers, or in the scores
themselves.
• Statistical regression effects (SR) occur when test
units with extreme scores move closer to the average
score during the course of the experiment.
• Selection bias (SB) refers to the improper assignment
of test units to treatment conditions.
• Mortality (MO) refers to the loss of test units while the
experiment is in progress.
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 A Classification of Experimental
Designs
Figure 7.1

Experimental Designs

Pre-experimental True Experimental Quasi

Statistical
Experimental

One-Shot Case Pretest-Posttest Time Series Randomized

Study Control Group Blocks

One Group Pretest- Posttest: Only Control Multiple Time Latin Square
Posttest Group Series

Static Group Solomon Four-Group Factorial Design

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Types of Causal Research Designs
Pre-Experimental Designs
One-Shot Study
(EG): X → O1
(HS + MA + SB + MO)
One-Group, Pretest-Posttest
(EG): O1 → X1 → O2
(HS + MA + SB + MO + I + MT + IT + SR)
Static Group Comparison
(EG): X → O1
(CG): O2
(SB + MO)
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Types of Causal Research Designs

True Experimental Designs

Pretest-Posttest, Control Group
(EG): [R] O1 → X → O2
(CG): [R] O3 → O4
TE = (O2 – O1) – (O4 – O3)

(IT)

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Types of Causal Research Designs

Posttest-Only, Control Group

(EG): [R] X → O1
(CG): [R] O2

(SB + MO)

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Types of Causal Research Designs

Quasi Experimental Design: Time Series Design

01 02 03 04 05 X 06 07 08 09 010

• There is no randomization of test units to

treatments.

• The timing of treatment presentation, as well

as which test units are exposed to the
treatment, may not be within the researcher's
control.

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Types of Causal Research Designs
Quasi Experimental: Multiple Time Series Design

EG : 01 02 03 04 05 X 06 07 08 09 010

CG : 01 02 03 04 05 06 07 08 09 010

• If the control group is carefully selected, this design

can be an improvement over the simple time series
experiment.

• Can test the treatment effect twice: against the

pretreatment measurements in the experimental
group and against the control group.
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Types of Causal Research Designs
Statistical Designs
Randomized Block Design

Treatment Groups
Block Store Commercial Commercial Commercial
Number Patronage A B C

1 Heavy A B C
2 Medium A B C
3 Low A B C
4 None A B C

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 Types of Causal Research Designs
Statistical Designs
Latin Square Design
Interest in the Store
Store Patronage High Medium Low

Heavy B A C
Medium C B A
Low and none A C B

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Types of Causal Research Designs
Statistical Designs
Factorial Design

Amount of Humor
Amount of Store No Medium High
Information Humor Humor Humor
Low A B C

Medium D E F

High G H I
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Laboratory vs. Field Experiments

Factor Laboratory Field

Environment Artificial Realistic
Control High Low
Reactive Error High
Low
Demand Artifacts High Low
Internal Validity High Low
External Validity Low High
Time Short Long
Number of Units Small Large
Ease of Implementation High Low
Cost
Low High

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 Limitations of Experimentation

• Experiments can be time consuming, particularly if

the researcher is interested in measuring the long-
term effects.
• Experiments are often expensive. The requirements
of experimental group, control group, and multiple
measurements significantly add to the cost of
research.
• Experiments can be difficult to administer. It may be
impossible to control for the effects of the extraneous
variables, particularly in a field environment.
• Competitors may deliberately contaminate the
results of a field experiment.
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Sample Marketing Experiments Using
Different Experimental Designs

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Test Marketing

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Test Marketing
• Test marketing is the phrase commonly
used to indicate an experiment, study, or
test that is conducted in a field setting.
• Two broad classes:
• To test the sales potential for a new
product or service
• To test variations in the marketing mix
for a product or service

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Classification of Test-Marketing
Procedures

• Standard test market: one in which the firm

tests the product and/or marketing mix
variables through the companies normal
distribution channels
• Controlled test markets: ones that are
conducted by outside research firms that
guarantee distribution of the product
through pre-specified types and numbers
of distributors

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Classification of Test-Marketing
Procedures contd…
• Electronic test markets: those in which a
panel of consumers has agreed to carry
identification cards that each consumer
presents when buying goods and services
• Simulated test markets: those in which a
limited amount of data on consumer
response to a new product is fed into a
model containing certain assumptions
regarding planned marketing programs,
which generates likely sales volume

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Test Marketing: Pros and Cons
• Pros:
• Allows most accurate method of
forecasting future sales
• Allows firms the opportunity to pretest
marketing mix variables
• Cons:
• Does not yield infallible results
• Are expensive
• Exposes the new product or service to
competitors
• Takes time to conduct

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References
• Prof. N. K. Malhotra’s Textbook and Slides
• Dr. Michael Hyman Slides

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Class Assignment

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