ANOVA: Case 2

An automobile company desires to determine an appropriate distribution of its promotional

budget between advertising, sales promotion schemes and direct marketing activities for its SUV
products. They are considering three types of distributions as indicated below:

Type A: Advertising focus: 60:30:10

Type B: Sales Promotion focus: 30:60:10

Type C: Direct Marketing focus: 30:10:60

To determine which type they should engage in, they have conducted an initial study by using
each of the above types in four different territories for one month periods over a timeframe of six
months. The sales data for each type territory-wise is provided below.

Territory Type A Type B Type C

1 132 146 63
2 184 134 88
3 156 127 118
4 128 132 138

Case Questions:

1. Do you think the different promotion budget distributions result in different sales of
SUVs?
2. Frame a null hypothesis to evaluate your thinking.
3. Test out the null hypothesis using a suitable statistical test.
4. What conclusion can you draw from your analysis? Justify your conclusion.

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