Session 4. Research Designs (Descriptive and
Causal)
MKTG 3010 MARKETING RESEARCH
1
Exercises - An Unusually Crowded Summer
Box Office, in Charts
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2
Provide a description of Figure 1?
What’s the difference between Figure 1 and Figure 2?
Why we create Figure 2?
What is “endogeneity”? What is the “endogeneity”
problem in this context?
What are the explanations for the crowded summer box
office?
Which one is more plausible? Why?
Shall we release the new movie in summer?
Figure 1
3
Figure 2
Endogeneity
More
People
Watch
Movies
4
More
Movies
Released
Marketing Research Process
Step 1: Defining the Problem
Step 2: Developing an Approach to the Problem
Step 3: Formulating a Research Design
Step 4: Doing Field Work or Collecting Data
Step 5: Preparing and Analyzing Data
Step 6: Preparing and Presenting the Report
5
Definition

A research design is a framework or blueprint for
conducting the marketing research project.

It details the procedures necessary for obtaining the
information needed to structure or solve marketing
research problems.
6
A Comparison of Basic Research Designs
Exploratory
Descriptive
Causal
Objective:
Discovery of ideas
and insights
Describe market
characteristics or
functions
Determine cause
and effect
relationships
Characteristics:
Flexible, versatile
Methods:
7
Marked by the prior
Manipulation of
formulation of specific independent
hypotheses
variables, effect
on dependent
Often the front end Preplanned and
variables
of total research
structured design
design
Control
mediating
Expert surveys
Secondary data:
variables
Pilot surveys
quantitative analysis
Focus group
Surveys
Experiments
Secondary data:
Panels
qualitative analysis Observation and other
qualitative research data
Descriptive Research
1.Survey
8
Methods of collecting descriptive data
Two ways to obtain quantitative
descriptive data
SURVEY
Information Obtained
by Questioning Respondents
9
OBSERVATION
Information Obtained
by Observing Behavior/
Phenomena
Classification of survey methods
Survey Methods
Telephone
Traditional
Telephone
ComputerAssisted
Telephone
Interviewing
10
Personal
Mail
Electronic
In-Home
Mail Panel
E-Mail
Mall Intercept
Mail/Fax
Interview
Internet
ComputerAssisted
Personal
Interviewing
South Korean Soap Operas: Just Lowbrow
Fun? (WSJ, Jul 23, 2013)
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Researcher: Seoul National University
Research Method: Survey
Sample: 400 people aged between 20 – 60 in China in January
Approach: divided viewers’ tastes into categories according to the levels of
income and education.
Findings:
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1. the main audience for South Korean series tends to be less educated and have less
income than viewers that prefer programs from other countries.
2. The high-education-and-high-income group showed a preference for the subject
matter’s novelty, fast pace and suspense — often found in U.S. TV shows, the report
said.
3. “The Big Bang Theory” was the most popular feature for fans of American TV.

Implication: What is it about South Korean TV soap operas that appeals to
foreign audiences? it’s because it’s lowbrow entertainment.
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The report also offers a caveat: highly-educated and high-income viewers
may conceal their fondness of lowbrow entertainment.
(http://blogs.wsj.com/korearealtime/2013/07/23/south-korean-soap-operas-just11
lowbrow-fun-2/)
Advantage of survey research

Ease: Questionnaires are relatively easy to
administer.

Reliability: Using fixed-response (multiple-choice)
questions reduces variability in the results that may
be caused by differences in interviewers and
enhances reliability of the responses.

Simplicity: It also simplifies coding, analysis, and
interpretation of data.

reliability: the measure produces similar results
under consistent conditions
12
Disadvantage of survey research

Respondents may be unable or unwilling to
provide the desired information.

Structured data collection involving a
questionnaire with fixed-response choices may
result in loss of validity for certain types of data,
such as beliefs and feelings.
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Properly wording questions is not easy.
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validity: the degree to which the tool measures
what it claims to measure.
13
Methods of improving response rate
Methods of Improving Response Rates
Prior
Notification
Incentives
Monetary
Prepaid
14
Follow-up
Nonmonetary
Promised
Other
Facilitators (e.g.
personalization)
Descriptive Research
2.Observation
15
Observational Research

Observation involves recording the
behavioral patterns of people as well as
data on objects and events in a systematic
manner to obtain information about
phenomenon of interest.
16
A Classification of Observation Methods
Observation Methods
Personal
Observation
17
Mechanical
Observation
Audit
Content
Analysis
Trace
Analysis
Relative Advantages of Observation
Actual behavior vs. intended or preferred
behavior
 No reporting bias, and potential bias
caused by the interviewer
 Certain types of data can be collected only
by observation (example?)
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18
The hand-washing habits of Americans.
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The study, conducted every few years, was released by the American
Society for Microbiology and the American Cleaning Institute at a
microbiology conference in Boston.
Some subjects were asked about their washing habits in telephone
interviews; others were watched by undercover observers in public
restrooms.
The researchers, from Harris Interactive, stood in restrooms while
pretending to fix their hair or put on makeup, said Brian Sansoni, a
spokesman for the American Cleaning Institute, a trade group for producers
of cleaning products. “After they took care of business, the observer checked
whether or not they actually washed their hands,” Mr. Sansoni said.
Only about two-thirds of the men observed washed their hands after using
the restroom at Turner Field — the lowest rate for any of the locations cited
in the study.
20 percent of people using the restrooms at Pennsylvania Station and Grand
Central Terminal in New York did not wash their hands.
Women tended to be more responsible hand-washers than men — and
female Braves fans were no exception: 98 percent of women observed
at Turner Field exercised proper hygiene before exiting the restroom.
19Many, ‘Washroom’ Seems to Be Just a Name – NYT (2010))
(For
Relative Disadvantages of Observation
Little is known about the underlying
motives, beliefs, attitudes, and preferences.
 Time-consuming and expensive
 May be unethical
 It is best to view observation as a
complement to survey methods, rather
than as being in competition with them.
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20
Science of Shopping
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Cameras and Software that Track our
Shopping Behavior
(https://www.youtube.com/watch?v=NG4lFmSO7VQ)
(https://www.youtube.com/watch?v=Dm6kPvJQTPI)
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Questions –
1.
2.
3.
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What research design is used in the video?
What questions can be answered based on
the collected data?
Any comment?
Causal Research Design
22
The danger of mixing up causality and
correlation
https://www.youtube.com/watch?v=8B271L3NtAw
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Is ice cream dangerous?
 What makes marriage men live longer than
single men? Is it because of marriage?
 Were bed lamps children’s abuse?
 High self-esteem lead to good grade?
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24
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Is ice cream dangerous?
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What makes marriage men live longer than
single men? Is it because of marriage?
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Reverse causality
Were bed lamps children’s abuse?
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Underling factor - weather
Underling factor - genetic
High self-esteem lead to good grade?
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25
Reverse causality
Correlation vs causation
 Correlation doesn’t imply
causation
 For any two correlated
events A and B, the
following relationships
are possible:
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A causes B;
B causes A;
A and B are consequences of a
common cause, but do not cause
each other;
There is no connection between A
and B, the correlation is coincidental.
26
Condition for causality

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.
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The time order of occurrence condition states
that the causing event must occur either before or
simultaneously with the effect; it cannot occur
afterwards.
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The absence of other possible causal factors
means additional or extraneous variables that
impact the effect variable must be controlled
27
Experimental design
An experimental design is a set of
procedures specifying
 the test units and how these units are to be
divided into homogeneous subsamples;
 what independent variables or treatments
are to be manipulated;
 what dependent variables are to be
measured;
 how the extraneous variables are to be
controlled.
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Definition and concepts

Independent variables are variables or alternatives that are
manipulated and whose effects are measured and compared,
e.g., price levels.

Test units are individuals, organizations, or other entities
whose response to the independent variables or treatments
is being examined, e.g., consumers or stores.
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Dependent variables are the variables which measure the
effect of the independent variables on the test units, e.g.,
sales, profits, and market shares.
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Extraneous variables are all variables other than the
independent variables that affect the response of the test
units, e.g., store size, store location, and competitive effort.
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A Classification of Experimental Designs
Experimental Designs
Pre-experimental
True
Experimental
One-Shot Case
Study
Pretest-Posttest
Control Group
Time Series
Randomized
Blocks
One Group
Pretest-Posttest
Posttest: Only
Control Group
Multiple Time
Series
Latin Square
Static Group
Solomon FourGroup
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Quasi
Experimental
Statistical
Factorial
Design
True Experimental Designs
Posttest-Only
Control Group
Design
(EG) R
(CG) R
X
O1
O2
time
X = Treatment; O = Observation
EG = Experimental Group; CG = Control Group
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Treatment effect = O2-O1
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R = Two stage randomization
True Experimental Designs
Pretest-Posttest
with Control
Group Design
(EG) R O1
(CG) R O3
X
O2
O4
time
X = Treatment; O = Observation
R = Two stage randomization
EG = Experimental Group; CG = Control Group

Treatment Effect = TE = (O2-O1)-(O4-O3)
32
Limitations of Experimentation
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Experiments can be time consuming, particularly if
the researcher is interested in measuring the longterm effects.

Experiments are often expensive. The
requirements of experimental group, control group,
and multiple measurements significantly add to the
cost of research.
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Experiments can be difficult to administer. It may
be impossible to control for the effects of the
extraneous variables, particularly in a field
environment.
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Marketing Applications of Experiments
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New product launch
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Controlled field experiment
Test markets (real/simulated)
Assessing advertising effectiveness
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Recognition , recall, persuasion
Purchase behavior (split-cable tests)
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Direct mail: Randomized offers
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Online experimentation
Discussion -
Does “endogeneity” affect identifying
causal relationship?
 How we use experiment to solve the
“endogeneity” issue?
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35
Homework - Psychology beats business
training when it comes to entrepreneurship
(https://www.economist.com/news/business/21729454-among-smallbusiness-owners-togo-least-psychology-beats-business-training-whenit-comes)
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What is the research question?
Which experimental design was used?
What is the treatment? How to calculate the
treatment effect?
What is the dependent variable?
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Define the Information Needed
Design the Exploratory, Descriptive, and/or Causal Phases of the Research
Specify the Measurement and Scaling Procedures
Construct a Questionnaire
Specify the Sampling Process and the Sample Size
Develop a Plan of Data Analysis
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Measurement and Scaling
38
Measure information
Gender
 Brands
 Price
 Income
 Preference
 Attitude
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Measurement
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Measurement means assigning numbers
or other symbols to characteristics of
objects according to predetermined rules.
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Scaling
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In the social sciences, scaling is the
process of measuring or ordering entities
with respect to quantitative attributes or
traits.
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It can be described in terms of four basic
characteristics:
41
Scaling
Description
Refers to the unique labels or descriptors that are used to designate each
value of the scale( e.g. 1 = Female, 0 = Male). All scales have description.
Order
Refers to the relative sizes or positions of the descriptors. Order is
denoted by descriptors such as greater than, less than, and equal to.
Distance
Refers to the absolute differences between the scale descriptors are
known and may be expressed in units.
Origin
Means that the scale has a unique or fixed beginning or true zero point
42
Four Types of Primary Scales
Primary Scales
Ratio
Scale
Interval
Scale
Ordinal
Scale
Nominal
Scale
43
Lowest level of
measurement
Highest level of
measurement
Levels of Measurement Scales
Rules
Nominal
Applications
Objects are either identical
or different
Objects are greater
or smaller
Description/
classification
Rankings
Interval
Intervals between objects
are equal (arbitrary zero)
Ratings
Ratio
Meaningful zero,
for comparison of
absolute magnitude
Amounts
Ordinal
Nominal Scale Measures
1. When at home, which TV brand do you watch most often? (circle one).
 Sony  Toshiba  Panasonic  Samsung  Phillips  Other
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Descriptions
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Statistics
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Frequency tables, mode
Use percentages belonging to each group
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Each individual/object either is or is not in a group
Can’t order the labels
chi-square tests, Z-test for proportions, discriminant, logistic regression
Useful as grouping variable
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t-tests/ANOVA/ (independent variable only)
Ordinal Scale Measures
1. Please rank each television brand in terms of your preference. Place a “1” by
your top choice, a “2” by your second choice, etc.
_ Sony _ Toshiba _ Panasonic _ Samsung _ Phillips
2. For each pair of television brands, circle the one you would be more likely to
purchase.
Sony versus Toshiba
Sony versus Panasonic ...
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Ranking
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Statistics
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X is better than Y
Can’t say by how much
Frequency tables, mode, median
Useful for ranking alternatives
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Rank-order correlation, some conjoint models
Interval Scale Measures
For each brand below, indicate how much you like each brand by circling
the appropriate number.
Not Like
Like
At All
Very Much
Sony
1
2
3
4
5
Toshiba
1
2
3
4
5
Panasonic
1
2
3
4
5
• Ratings
– X is n units different from Y
– Distance between 2 and 3 is same as distance between 3 and 4 (or is it?)
• Statistics
– Frequency tables, mode, median, mean, standard deviation
• t-tests, regression, ANOVA, factor, cluster, some conjoint
– Can’t compare absolute magnitude (“4” ≠ 2 X “2”)
Ratio Measure Scales
How much would you be willing to pay for a 24” flat screen TV made by each
company?
Sony
$_______
Toshiba
$_______
Panasonic
$_______
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Amounts, zero has meaning
X is n units different than Y
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Distance between 2 and 3 is half of distance between 2 and 4
Statistics

Frequency tables, mode, median, mean, standard deviation,
geometric mean

t-tests, regression, ANOVA, factor, cluster, some conjoint
Can compare absolute magnitude (“4” = 2 x “2”)
Use of Rating Scales in Self-Report
Measurements
49
Scaling Techniques
Scaling
Techniques
Noncomparative
Scales
Comparative
Scales
Continuous
Rating Scales
Paired
Comparison
Rank
Order
Constant
Sum
Itemized
Rating Scales
Likert
Semantic
Differential
Stapel
Comparative scales involve the direct comparison
of stimulus objects.
- e.g. Do you prefer Pepsi or Coke?
- Comparative scale data must be interpreted in relative
terms and have only ordinal or rank order properties.
In noncomparative scales, each object is scaled
independently of the others in the stimulus set.
- e.g. How do you feel about Coke?
- The resulting data are generally assumed to be interval
or ratio scaled.
Comparative Scaling
- Nonmetric Scaling
52
Comparative Scaling Techniques:
Paired Comparison Scaling

A respondent is presented with two objects and asked
to select one according to some criterion.

e.g. Do you prefer Pepsi or Coke?
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The data obtained are ordinal in nature.

Paired comparison scaling is the most widely used
comparative scaling technique.

Under the assumption of transitivity, it is possible to
convert paired comparison data to a rank order
Comparative Scaling Techniques:
Rank Order Scaling

Respondents are presented with several objects
simultaneously and asked to order or rank them
according to some criterion.

e.g. Rank the following advertisements. 1 denotes the
one you like the most and 10 is the one you least
preferred. No two ads should receive the same rank
number.

Rank order scaling also results in ordinal data.
Comparative Scaling Techniques:
Constant Sum Scaling

A respondent is given a constant sum of money, script,
credits, or points and asked to allocate these to various
items

e.g. If you had 100 HKD to spend on food products,
how much would you spend on product A, on product
B, on product C, etc.

This is also an ordinal level technique.
Relative Advantages of Comparative Scales

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Small differences between stimulus objects can be
detected.
Same known reference points for all respondents.
Easily understood and can be applied.
Involve fewer theoretical assumptions.
Tend to reduce halo or carryover effects from one
judgment to another.
The halo effect or halo error is a cognitive bias in which one's
judgments of a person’s character can be influenced by one's overall
impression of him or her. (wikipedia)
Relative Disadvantages of Comparative
Scales


Ordinal nature of the data.
Inability to generalize beyond the stimulus objects
scaled.
Noncomparative Scaling
- Metric Scaling
58
A classification of scaling techniques
Scaling
Techniques
Comparative
Scales
Noncomparative
Scales
Itemized
Rating Scales
Continuous
Rating Scales
Likert
Semantic
Differential
Stapel
Continuous Rating Scale

Respondents rate the objects by placing a mark at the
appropriate position on a line that runs from one extreme
of the criterion variable to the other.
How would you rate SOGO as a department store?
Version 1
Probably the worst - - - - - - -I - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Probably the best
Version 2
Probably the worst - - - - - - -I - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - Probably the best
0
10
20
30
40
50
60
70
80
90
100

Scoring and codification is difficult.
Itemized Rating Scales- Likert Scale

Respondents are asked to indicate the amount of
agreement or disagreement (from strongly agree to
strongly disagree) on a five- to nine-point scale.
Strongly
disagree
Disagree
Neither
Agree
agree nor
disagree
Strongly
agree
1. SOGO sells high quality merchandise.
1
2
3
4
5
2. SOGO has poor in-store service.
1
2
3
4
5
3. I like to shop at SOGO.
1
2
3
4
5


The analysis can be conducted on an item-by-item basis (profile analysis),
or a total (summated) score can be calculated.
When arriving at a total score, the categories assigned to the negative
statements by the respondents should be scored by reversing the scale.
Itemized Rating Scales- Semantic
Differential Scale

The semantic differential is a seven-point rating scale with end
points associated with bipolar labels that have semantic
meaning.
e.g. Please mark (X) at the point along the scale that best describes what the store
means to you. Please be sure to mark every scale; do not omit any scale.
SOGO is:
Powerful
Unreliable
Modern


--:--:--:--:-X-:--:--: Weak
--:--:--:--:--:-X-:--: Reliable
--:--:--:--:--:--:-X-: Old-fashioned
The negative adjective or phrase sometimes appears at the left side of the
scale and sometimes at the right.
This controls the tendency of some respondents, particularly those with
very positive or very negative attitudes, to mark the right- or left-hand
sides without reading the labels.
Itemized Rating Scales- Stapel Scale

The Stapel scale is a unipolar rating scale with ten categories numbered
from -5 to +5, without a neutral point (zero). This scale is usually
presented vertically.
SOGO
e.g. Please evaluate how accurately each
word or phrase describes the store. Select a
plus number by placing an (x) beside it for
the phrases you think describe the store
accurately. The more accurately you think
the phrase describes the store, the larger
the positive number you should choose. A
larger negative number indicates that the
phrase does not describe the store at all.

+5
+5
+4
+4
+3
+3
+2
+2x
+1
+1
High Quality
Poor Service
-1
-1
-2
-2
-3
-3
-4x
-4
-5
-5
The data obtained by using a Stapel scale can be analyzed in the same way
as semantic differential data.
Some Unique Rating Scale Configurations
Thermometer Scale
Instructions: Please indicate how much you like McDonald’s hamburgers by coloring in
the thermometer. Start at the bottom and color up to the temperature level that best
indicates how strong your preference is.
Form:
100
75
50
25
0
Like very much
Dislike very much
Smiling Face Scale
Instructions: Please point to the face that shows how much you like the Barbie
Doll. If you do not like the Barbie Doll at all, you would point to Face 1. If you
liked it very much, you would point to Face 5.
Form:
1
2
3
4
5
The Big Debate: Response Scales

Likert-type scales: 3-11 categories
Even
or
Less “cop-outs”
vs.
Can express indifference
All Labeled
or
Ends Labeled?
vs.
Interval not Ordinal
or
More?
vs.
Can express distinctions
Consistent interpretation
Fewer
Less interpretation error
Odd?
Unmotivated, uninformed,
Motivated, informed,
heterogenous
Warning: In 1-10 scales, homogenous
is 5 the midpoint?
Choosing the Right Level Scale

Consider information needs





Use dummy tables
Plan analysis before you begin
Plan ahead for advanced methods (segmentation,
conjoint, regression, etc..)
You can always do less...but never more
Consider ease of use for respondent

Choice can be easier than absolute preference
Malcolm Gladwell: Choice, Happiness, and
Spaghetti Sauce

1. What was Howard’s question? Where did it come from? What was the
answer to the question?

2. What was the story about Prego? What did Howard do differently in the
case of Prego?

3. What have people done wrong in the past?

4. What is horizontal segmentation? What is the other way to segment the
product market? What is the Platonic dish? What’s wrong with it?

5. Is it always good to have more options?

6. How does the talk link to what we have learned so far?

7. What can we learn from the stories?
67