Market Research - Ch. 5 Causal Research Designs

External validity

The extent to which a causal relationship found in a study can be expected to be true for the entire population

Experiment

an empirical investigation that tests for hypothesized relationships between dependent variables and manipulated independent variables

Variable

an observable, measurable element, such as a characteristic of a product or service or an attitude or behavior; concept or construct that can vary or have more than one value; demographics (age, gender, income), attitudes such as brand loyalty and customer satisfaction, outcomes such as sales and profits, and behaviors such as media consumption, website traffic, purchase, and product usage

Extraneous variables

any variables that experimental researcher do not measure or control that may affect the dependent variable (i.e. respondent's mood or feelings, temperature of the room, general weather

Laboratory experiments

causal research designs that are conducted in an artificial setting Positives - enable the researcher to control the setting and therefore achieve high internal validity, best for secret experiments Negatives of laboratory experiments - laboratory experiments lack external validity

Field experiments

causal research designs that manipulate the independent variables in order to measure the dependent variable in a natural setting; performed in natural or real settings, retail environments such as malls or supermarkets. Negatives of field experiments: independent and extraneous variables are difficult to control (difficult to introduce a new product to proper display, let alone the supermarket themselves) Time frames - need a lot of time, Costs - expensive, Competitive reactions - competitors could find out about the product. Positives: high level of realism

Positives and Negatives of Test Marketing

cost of conducting test marketing experiments can be high but with the failure rate of new consumer products and services estimated to be between 80 and 90 percent, many companies believe the expense of conducting test marketing can help them avoid the more expensive mistake of an unsuccessful product or service rollout

Negatives of field experiments

independent and extraneous variables are difficult to control (difficult to introduce a new product to proper display, let alone the supermarket themselves) Time frames - need a lot of time, Costs - expensive, Competitive reactions - competitors could find out about the product. Positives - high level of realism

Negatives of laboratory experiments

laboratory experiments lack external validity

Dependent Variable

measures of effects or outcomes that occur as a result of changes in levels of the independent or causing variable(s)

Test marketing

most common type of field experiment, using controlled field experiments to gain information on specified market performance indicators. For example, marketing mix variables (produce. Price, place, and promotion) are manipulated and changes in dependent variables such as sales volume or website traffic are measured. Tests a new product on a small scale to see if it will be successful on a larger scale. Goal - predict sales, identify possible customer reactions, and anticipate adverse consequences of marketing programs Positives and Negatives of Test Marketing: cost of conducting test marketing experiments can be high but with the failure rate of new consumer products and services estimated to be between 80 and 90 percent, many companies believe the expense of conducting test marketing can help them avoid the more expensive mistake of an unsuccessful product or service rollout

Causal research

studies that enable researchers to assess cause and effect relationships between two or more variables

Validity

the extent to which the conclusions drawn from an experiment design are true

Internal validity

the extent to which the research design accurately identifies causal relationships

Validity concerns with experimental research

validity, internal validity, external validity

Control variables

variables the researcher does not allow to vary freely or systematically with independent variables; control variables should not change as the independent variable is manipulated

Independent Variable

variables whose values are directly manipulated by the researcher