Chapter 7 Causal Designs Issues Addressed conditions of causality what is an experiment? differences between a lab vs field experiment two types of experimental validity extraneous factors that affect validity types of experimental designs test marketing and types of test markets Conditions of Causality Concomitant variation » extent to which the cause (X) and the effect (Y) occur together – e.g., advertising and sales Time Order of Occurrence of Variables » X has to occur before Y Elimination of Effects of Other Factors » for X to cause Y, X has to be associated with Y even after the effects of all other factors have been accounted for What is an Experiment? is a scientific investigation in which one or more independent variables are manipulated and the effect on a dependent variable is observed. other potential independent variables are controlled class to come up with an experiment Field versus Lab Experiments Lab Experiment » create a situation with desired conditions » manipulate some variables while controlling others » examine the dependent variable Field Experiment » research study in a natural setting » manipulate some variables » under as carefully controlled conditions as the situation would permit » examine the dependent variable Experimental Validity Internal Validity » extent to which the researcher can attribute the effect observed to the experimental variable and not to other factors » effect of price on sales » other factors (ad, display space, store traffic, competitor prices) » these can be maintained constant in a lab experiment Experimental Validity (cont.) External Validity » extent to which the results of the experiment can be generalized to other situations » e.g. simulated shopping trip and problems Extraneous Factors Affecting Validity History Maturation Testing Instrument Variation Selection Bias Experimental Mortality History specific events, external to the experiment occurring at the same time as the experiment that may affect the dependent variable e.g., refrigerator pricing usually difficult to identify history factors Maturation changes occurring within the test units which are not due to the effects of the experimental variable e.g., tired, hungry, not attentive effects observed may then be partly attributable to the changes in the test unit particularly relevant in longitudinal studies respondents may undergo changes in taste, family status, knowledge level Testing the process of experimentation itself affects the observed response main testing effect » effect of a prior observation on a later observation » may be a result of respondent desire to be consistent » can occur in both longitudinal and crosssectional studies » affects internal validity of the experiment Testing (cont.) interactive testing effect » effect of a prior measurement on the test unit’s response to the independent variable » e.g. attitude toward a brand » sensitivity to that brand’s information » measured effects are then not generalizable to the population » affects external validity of the experiment Instrument Variation effect of changes in the measuring instruments on what is being measured could also occur because of variability in administration pricing study Selection Bias occurs when it is difficult to certify that groups of test units are equivalent matching and randomization techniques Experimental Mortality loss of test units during an experiment comparison of units lost with units retained Controlling Extraneous Variables randomization matching statistical control design control Types of designs Preexperimental True Experimental Quasi-experimental Pre-experimental Designs One Shot Case Study One Group Pretest-Posttest Design Static Group Design True Experimental Designs Pretest-Posttest Control Group Design Posttest-Only Control Group Design Quasi-Experimental Design Time Series Design Market Test is a controlled experiment, done in a limited but carefully selected part of the marketplace, whose aim is to predict the sales or profit consequences ... of one or more proposed marketing actions” is the final gauge of consumer acceptance three out of four products test marketed succeed, while four out of five that have not been test marketed fail Types of Test Markets Standard Test Markets » products sold thru’ normal distribution channels » results monitored by a standard syndicated service Controlled Test Markets » entire test program is done by an outside service Electronic Test Markets » variant of controlled markets » use of consumer panels to measure purchases and TV viewing behavior Simulated Test Markets » use of a simulated shopping environment » fast, cheap, protection from competitors