Exploring Marketing Research: Bivariate Statistics-Tests of Differences

Exploring
Marketing Research

William G. Zikmund

Chapter 22:
Bivariate Statistics-
Tests of Differences
Copyright 2000 by Harcourt, Inc.
All rights reserved. Requests for
permission to make copies of any part
of the work should be mailed to the
following address: Permissions
Department, Harcourt, Inc., 6277 Sea
Harbor Drive, Orlando Florida
32887-6777

Copyright 2000 by Harcourt, Inc. All rights reserved.
Common Bivariate Tests
Type of Measurement
Differences between
two independent groups
Differences among
three or more
independent groups
Interval and ratio
Independent groups:
t-test or Z-test
One-way
ANOVA

Type of Measurement
Differences between
Differences among
three or more
independent groups
Ordinal
Mann-Whitney U-test
Wilcoxon test
Kruskal-Wallis test

Type of Measurement
Differences between
Differences among
three or more
independent groups
Nominal
Z-test (two proportions)
Chi-square test
Chi-square tst

Type of
Measurement
Differences between
Nominal
Chi-square test

Differences Between Groups
Contingency Tables
Cross-Tabulation
Chi-Square allows testing for significant
differences between groups
Goodness of Fit

Chi-Square Test
=
i
i i
) (

E
E O
x
x = chi-square statistics
O
i
= observed frequency in the i
th
cell
E
i
= expected frequency on the i
th
cell

n
C R
E
j i
ij
=
R
i
= total observed frequency in the i
th
row
C
j
= total observed frequency in the j
th
column
n = sample size
Chi-Square Test
D.f.=(R-1)(C-1)

Degrees of Freedom

Awareness of Tire
Manufacturers
Brand Men Women Total
Aware 50 10 60

Unaware 15 25 40
65 35 100

Chi-Square Test: Differences Among
Groups Example
21
) 21 10 (
39
) 39 50 (
2 2
2
= X
14
) 14 25 (
26
) 26 15 (
2 2
+

161 . 22
643 . 8 654 . 4 762 . 5 102 . 3
2
2
=
= + + + =
_
_

1 ) 1 2 )( 1 2 ( . .
) 1 )( 1 ( . .
= =
=
f d
C R f d
X
2
=3.84 with 1 d.f.

Type of
Measurement
Differences between
Interval and
ratio
t-test or
Z-test

when Comparing Means
Ratio scaled dependent variables
t-test
When groups are small
When population standard deviation is
unknown
z-test
When groups are large

Null Hypothesis About Mean
0
2 1
2 1
=

OR

t-Test for Difference of Means
means random of y Variabilit
Mean Mean
t

2 1
=

2 1
2 1

X X
S
t
X X
=
X
1
= mean for Group 1
X
2
= mean for Group 2
S
X
1
-X
2
= the pooled or combined standard error
of difference between means.

2 1
2 1

X X
S
t
X X
=

X
1
= mean for Group 1
X
2
= mean for Group 2
S
X
1
-X
2
= the pooled or combined standard error
of difference between means.

Pooled estimate of the
standard error
( )
|
|
.
|
\
|
+
|
|
.
|
\
|
+
+
=
2 1 2 1
2
2 2
2
1 1
1 1
2
) ) 1 ( 1
2 1
n n n n
S n S n
S
X X

S
1
2
= the variance of Group 1
S
2
2

n
1
= the sample size of Group 1
n
2
Pooled estimate of the
standard error


Pooled estimate of the Standard Error
t-Test for the difference of Means
( )
|
|
.
|
\
|
+
|
|
.
|
\
|
+
+
=
2 1 2 1
2
2 2
2
1 1
1 1
2
) ) 1 ( 1
2 1
n n n n
S n S n
S
X X
S
1
2
S
2
2

n
1
n
2

Degrees of Freedom
d.f. = n - k
where:
n = n
1 +
n
2
k = number of groups

-example
( )( ) ( )( )
|
.
|
\
|
+
|
|
.
|
\
|
+
=
14
1
21
1
33
6 . 2 13 1 . 2 20
2 2
2 1
X X
S
797 . =

797 .
2 . 12 5 . 16
= t
797 .
3 . 4
=
395 . 5 =

Type of
Measurement
Differences between
Nominal
Z-test (two proportions)

Comparing Two Groups when
Comparing Proportions
Percentage Comparisons
Sample Proportion - P
Population Proportion -
H

Differences Between Two Groups
when Comparing Proportions
The hypothesis is:
H
o
: H
1
= H
2

may be restated as:
H
o
: H
1
H
2
= 0

A Z-Test for Differences of Proportions
2 1
: t t =
o
H
or
0 :
2 1
= t t
o
H

Z-Test for Differences of Proportions
( ) ( )
2 1
2 1 2 1
p p
S
p p
Z

=
t t

p
1
= sample portion of successes in Group 1
p
2
= sample portion of successes in Group 2
(t
1
t
1
) = hypothesized population proportion 1
minus hypothesized population
proportion 1 minus
S
p1-p2
= pooled estimate of the standard errors of
difference of proportions

- to calculate the standard error of the difference of proportions
|
|
.
|
\
|
=
2 1
1 1
2 1
n n
q p S
p p

p = pooled estimate of proportion of success in a
sample of both groups
p = (1- p) or a pooled estimate of proportion of
failures in a sample of both groups
n
1
= sample size for group 1
n
2
= sample size for group 2
p
q
p

- weighted average
2 1
2 2 1 1
n n
p n p n
p
+
+
=

( )( )
|
.
|
\
|
+ =
100
1
100
1
625 . 375 .
2 1
p p
S
068 . =

( )( ) ( )( )
100 100
4 . 100 35 . 100
+
+
= p
375 . =

Type of
Measurement
Differences between
three or more
independent groups
Interval or ratio
One-way
ANOVA

Analysis of Variance
Hypothesis when comparing three groups
1
=
2
=
3

groups within Variance
groups between Variance
F

=
- F-Ratio

- Sum of squares
between within total
SS SS SS + =

- Sum of squares
= =
=
n
i
c
j 1 1
2
total
) ( SS X X
ij

- Sum of squares
p
i
= individual scores, i.e., the i
th
observation or
test unit in the j
th
group
p
i
= grand mean
n = number of all observations or test units in a
group
c = number of j
th
groups (or columns)
ij
X
X

= =
=
n
i
c
j
j
1 1
2
within
) ( SS X X
ij
- Sum of squares

Analysis of variance
- Sum of squares
p
i
th
observation or
test unit in the j
th
group
p
i
= grand mean
n = number of all observations or test units in a
group
c = number of j
th
groups (or columns)
ij
X
X

=
=
n
j
j j
n
1
2
between
) ( SS X X
- Sum of squares

- Sum of squares
th
observation or
test unit in the j
th
group
= grand mean
n
j
= number of all observations or test units in a
group
j
X
X

1
=
c
SS
MS
between
between
- Mean Squares Between

c cn
SS
MS
within
within
=
- Mean Square Within

within
between
MS
MS
F =
- Calculation of F-Ratio

A Test Market Experiment on Pricing
Sales in Units (thousands)
Regular Price
$.99

130
118
87
84

X
1
=104.75
X=119.58
Reduced Price
$.89

145
143
120
131

X
2
=134.75

Cents-Off Coupon
Regular Price

153
129
96
99

X
1
=119.25

Test Market A, B, or C
Test Market D, E, or F
Test Market G, H, or I
Test Market J, K, or L

Mean
Grand Mean

ANOVA Summary Table
Source of Variation
Between Groups
Sum of Squares
SS
BETWEEN
Degrees of Freedom
c-1 where c=number of groups
Mean Squared-MS
BETWEEN

SS
BETWEEN
/c-1

Within Groups
Sum of Squares
SS
WITHIN
Degrees of Freedom
cn-c where c=number of groups, n= number of
observations in a group
Mean Squared-MS
WITHIN

SS
WITHIN
/cn-c
ANOVA Summary Table
Source of Variation

Total
Sum of Squares
SS
TOTAL
Degrees of Freedom
cn-1 where c=number of groups, n= number of
observations in a group
WITHIN
BETWEEN
MS
MS
F =
ANOVA Summary Table
Source of Variation

Type of
Measurement
Differences between
Ordinal
Mann-Whitney U-test
Wilcocon test

Exploring Marketing Research: Bivariate Statistics-Tests of Differences

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