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MARKETING RESEARCH
AND MARKETING
MANAGEMENT
(22CB402)
Department: CSBS
Batch/Year: II YEAR / IV SEM
Created by: Dr.S.D. Uma Mageswari
[Link]
[Link] Pillai
 1. CONTENTS

S. Page
Contents
No No
1 Course Objectives 6

2 Pre Requisites 7

3 Syllabus 8

4 Course outcomes 9

5 CO- PO/PSO Mapping 10

6 Activity based learning 11

7 Lecture Notes 12

8 Assignments 51

9 Part A Questions & Answers 52

10 Part B Questions 53

11 Supportive online Certification courses 54

12 Real time Applications 55

13 Contents beyond the Syllabus 59

14 Assessment Schedule 63

15 Prescribed Text Books & Reference Books 64

16 Mini Project Suggestions 65

5
 1. COURSE OBJECTIVES

The Course will enable learners to:

I. Understand basic marketing concepts

II. Comprehend the dynamics of marketing.
III. Leverage marketing concepts for effective decision making
IV. Understand basic concepts and application of statistical tools in
Marketing research
V. Apply Internet marketing strategies.

6
 2. PRE REQUISITES
• Pre-requisite Chart

MARKETINGRESEARCH AND
MARKETING MANAGEMENT
(22CB402)

22CB302 FUNDAMENTALS OF ECONOMICS

7
 MARKETING RESEARCH AND L T P C
22CB402 MARKETING MANAGEMENT
Curriculum And Syllabus
3 0 0 3
UNIT I INTRODUCTION 9
Marketing Concepts and Applications: Introduction to Marketing &
Core Concepts, Marketing of Services, Importance of marketing in
service sector. Marketing Planning & Environment: Elements of
Marketing Mix, analyzing needs & trends in Environment - Macro,
Economic, Political, Technical & Social Understanding the consumer:
Determinants of consumer behavior, Factors influencing consumer
behavior
UNIT II MARKET SEGMENTATION AND PRODUCTION MANAGEMENT 9
Market Segmentation: Meaning & Concept, Basis of segmentation,
selection of segments, Market Segmentation strategies, Target
Marketing, Product Positioning Product Management: Product Life
cycle concept, New Product development & strategy, Stages in New
Product development, Product decision and strategies, Branding &
packaging
UNIT III PRICING, PROMOTION AND DISTRIBUTION STRATEGY 9
Pricing, Promotion and Distribution Strategy: Policies & Practices –
Pricing Methods & Price determination Policies. Marketing
Communication – The promotion mix, Advertising & Publicity, 5 M’s of
Advertising Management. Marketing Channels, Retailing, Marketing
Communication, Advertising.
UNIT IV MARKETING RESEARCH 9
Marketing Research: Introduction, Type of Market Research, Scope,
Objectives & Limitations Marketing Research Techniques, Survey
Questionnaire design & drafting, Pricing Research, Media Research,
Qualitative Research Data Analysis: Use of various statistical tools –
Descriptive & Inference Statistics, Statistical Hypothesis Testing,
Multivariate Analysis - Discriminant Analysis, Cluster Analysis,
Segmenting and Positioning, Factor Analysis
UNIT V INTERNET MARKETING 9
Internet Marketing: Introduction to Internet Marketing. Mapping
fundamental concepts of Marketing (7Ps, STP); Strategy and Planning
for Internet Marketing Business to Business Marketing: Fundamental of
business markets. Organizational buying process. Business buyer needs.
Market and sales potential. Product in business markets. Price in
business markets. Place in business markets. Promotion in business
markets. Relationship, networks and customer relationship
management. Business to Business marketing strategy.
4. COURSE OUTCOMES

Upon completion of the course, the students will be able to:

• CO1: Understand the marketing concepts and its evolution
• CO2: Analyze the market based on segmentation, targeting and
positioning
• CO3: Leverage marketing concepts for decision making on product,
price, promotion mix and distribution
• CO4: Apply the concepts of market research and analyse data using
statistical tools
•
CO5: Apply internet marketing strategies for businesses
 5. CO - PO / PSO MAPPING

PROGRAM OUTCOMES PSO

K3, PSO PSO PSO

CO HKL K3 K4 K5 K5 K4, A3 A2 A3 A3 A3 A3 A2 1 2 3
K5
PO PO PO PO PO PO PO PO PO PO PO PO
-1 -2 -3 -4 -5 -6 -7 -8 -9 -10 -11 -12

CO1 K1 3 2 1 - - - - 1 1 1 - 1 2 - -

K3 3 2 1 - - - - 1 1 1 - 1 2 - -
CO2
K2 3 2 1 - - - - 1 1 1 - 1 2 - -
CO3
K3 3 2 1 - - - - 1 1 1 - 1 2 - -
CO4
K3 3 2 1 - - - - 1 1 1 - 1 2 - -
CO5

• Correlation Level - 1. Slight (Low) 2. Moderate (Medium)

3. Substantial (High) , If there is no correlation, put “-“.

10
 6. Activity based learning

Activity Topic Outcome

SEMINAR Marketing Research Students took seminar

PRESENTATION Techniques about different
Marketing Research
techniques

Questionnaire Marketing Research Students are asked to

Preparation prepare the
Questionnaire and
represent the data
UNIT IV MARKETING 9
RESEARCH

Marketing Research: Introduction, Type of Market Research, Scope, Objectives &

Limitations Marketing Research Techniques, Survey Questionnaire design & drafting,

Pricing Research, Media Research, Qualitative Research

Data Analysis: Use of various statistical tools - Descriptive & Inference Statistics, Statistical

Hypothesis Testing, Multivariate Analysis - Discriminant Analysis, Cluster Analysis,

Segmenting and Positioning, Factor Analysis

4.1 Market Research and Marketing Research

Generally Market Research and Marketing Research are confused to be the same. But there

is a clear distinction between the both.

Market Research: Market Research involves researching a specific industry or market. Ex:

Researching the automobile industry to discover the number of competitors and their market

share.

Marketing Research: Marketing Research analyses a given marketing opportunity or

problem, defines the research and data collection methods required to deal with the problem

or take advantage of the opportunity, through to the implementation of the project. It is a

more systematic method which aims to discover the root cause for a specific problem within

an organisation and put forward solutions to that problem. Ex: Research carried out to

analyze and find solution for increasing turnover in an organisation

4.2 Types of Market Research:

4.3 Marketing Research:

□ "The careful and objective study of product design, markets and such transfer activities

as physical distribution, warehousing advertising and sales management. Thus the scope of

marketing research lies in its variety of applications."

It is a technique to know:

1. Who are customers of our products or services?

2. Where do they live?

3. When and how do they buy the product and services?

4. Are customers of our products satisfied with the products?

5. Who are our main competitors in the market?

6. Are the company's products inferior or superior to competitors' products?

7. What policies and strategies are they following?

4.4 Scope of Marketing Research:
□ The scope of marketing research stretches from the identification of

consumer wants and needs to the evaluation of consumer satisfaction.

SCOPE OF MARKETING RESEARCH

1. Size of the present and potential market. 6. Analysis of market demand.

2. Consumer needs wants, habits and 7. Knowledge of competitors and their

behaviour. products.

3. Dealer wants and preferences. 8. Knowing the profitability of different

4. Analysis of the market size according to markets.

age, sex, income, profession, standard of 9. Study the market changes and market
living etc. conditions.
5. Geographic location of customers.
10. Analysis of various channels of distribution.
4.5 Objectives of Marketing
Research:

1. To understand the economic factors 11. To study the customer's acceptance of

affecting the sales volume and their products.

opportunities. 12. To assess the volume of future sales.

2. To understand the competitive position of

13. To study the nature of the market, its
rival products.
location and its potentialities.
3. To evaluate the reactions of consumers and
14. To find solutions to problems relating to
customers.
marketing of goods and services.
4. To study the price trends.

5. To evaluate the system of distribution. 15. To evaluate policies and plans in the

6. To understand the advantages and right course of action.

16. To know the development of science and
limitation of the products.
technology.
7. To find new methods of packaging, by
17. To know the complexity of marketing.
comparing other similar packages.

8. To analyze the market size.

18. To measure the effectiveness of
9. To know the estimation of demand.
advertising.
10. To evaluate the profitability of different 19. To estimate the potential market for a

markets. new product.

20. To assess the strength and weakness of

the competitors.

4.6 Marketing Research Methods

Methodologically, marketing research uses four types of research designs.

• Qualitative marketing research - This is generally used for exploratory purposes. The

data collected is qualitative and focuses on people's opinions and attitudes towards a

product or service. The respondents are generally few in number and the findings cannot be

generalised tot eh whole population. No statistical methods are generally applied.

Ex: Focus groups, In-depth interviews, and Projective techniques

• Quantitative marketing research - This is generally used to draw conclusions for a

specific problem. It tests a specific hypothesis and uses random sampling techniques so as

to infer from the sample to the population. It involves a large number of respondents and

analysis is carried out using statistical techniques.

Ex: Surveys and Questionnaires

• Observational techniques - The researcher observes social phenomena in their

natural setting and draws conclusion from the same. The observations can occur cross-

sectionally (observations made at one time) or longitudinally (observations occur over

several time-periods)

Ex: Product-use analysis and computer cookie tracing

• Experimental techniques - Here, the researcher creates a quasiartificial environment

to try to control spurious factors, then manipulates at least one of the variables to get an

answer to a research

Ex: Test marketing and Purchase laboratories

4.7 Marketing Research Process

The Marketing Research Process involves a number of inter-related activities which have

bearing on each other. Once the need for Marketing Research has been established, broadly

it involves the steps as depicted in Figure 1 below:

1. PROBLEM DEFINITION

This is the starting point in the marketing research exercise. In problem definition it is

important to be specific, avoiding ambiguities and generalities. Care should also be taken,

not to define problems in too narrow a field as that may distract the researcher's

perspective. This may even affect creativity in the research.

2. RESEARCH OBJECTIVES

Once the problem is defined, the next logical step is to state what the researcher wants to

achieve. This statement is called objectives. To be meaningful and help focus the

researcher's attention, these objectives should be specific, attainable & measurable. The

purpose of these objectives is to act as a guide to the researcher and help him in

maintaining a focus all through the research.

3. RESEARCH DESIGN

The third stage in the marketing research process is deciding on the research design. There

are three types of research designs, namely:

1. Exploratory: This kind of research is conducted when the researcher does not know how

& why a certain phenomenon occurs. Since the prime goal of an exploratory research is to

know the unknown, this research is unstructured. Focus groups, interviewing key customer

groups, experts and even search for printed or published information are some common

techniques.
2. Descriptive: This research is carried out to describe a phenomenon or market

characteristics. For example, a study to understand buyer behavior & describe

characteristics of the target market is a descriptive research. Continuing the above example

of service quality, a research done on how consumers evaluate the quality of competing

service institutions can be considered as an example of descriptive research.

3. Causative: This kind of research is done to establish a cause and effect relationship, for

example the influence of income & lifestyle on purchase decision. Here the researcher may

like to see the effect of rising income & changing lifestyle on consumption of select products.

4. SOURCES OF DATA

Once the research design has been decided upon, the next stage is that of selecting the sources

of data. Essentially there are two sources of data or informationsecondary & primary

• Secondary data: This refers to the information that has been collected earlier by someone

else. Often this includes printed or published reports, news items, industry or trade statistics

etc. this also includes internal documents like invoices, sales reports, payment history of

customers etc. these are important to the researcher as they provide an insight to the

problem. Often the preliminary investigation is restricted to secondary data.

• Primary data: To overcome the limitations of incompatibility, obsolescence and bias, the

researcher turns to the primary data. This is also resorted to when the secondary data is

incomplete. Primary sources refer to data collected directly from the market place-

customers, traders & suppliers often are the major sources. They are often reliable data

sources and help in overcoming limitations of secondary data. The problem in primary data

is its cost, both In terms of money & time, and often a researcher bias also creeps in.

5. DATA COLLECTION
 The researcher is now ready to take the plunge. But still he or she needs to be clear about

the following.

Procedure for data collection.

Data can be collected through any or combination of the following techniques.

• Observation: This technique involves observing how a customer behaves in the shopping

area, how he or she dresses up & what does the customer say when he or she sees the

product.

• Experimentation: This is a technique that involves experimenting new product ideas,

advertising copies & campaigns, sales promotion ideas & even pricing & distribution

strategies with the target customer group. These experiments can be conducted in an

uncontrolled environment or in a controlled & simulated market environment.

Tools for data collection

The researcher has to decide on the appropriate tool for data collection. These tools are:-

• Questionnaire — used for the survey method

• Interview schedule — used mainly for exploratory research

• Association test — primarily used in qualitative research, also called as TAT (Thematic

Apperception Test)

6. DATA ANALYSIS

The next stage is that of data analysis .It is important to understand raw data has no usage in

marketing research .hence appropriate analytical tools must be used. The most elementary

is the arithmetic analysis using percentile and ratios. Statistical analysis like mean, median,

mode, percentages, standard deviation and coefficient of correlations should be used

wherever applicable

7. REPORT & PRESENTATION

The last stage is that of writing out a report and making a presentation to the Decision —

maker. It is important that the report has summary, called the executive summary, giving a

bird's-eye view of the research. This is because most senior managers have little time for

going through the entire report in depth. The executive summary can direct the reader's

attention to specific issues by turning to the relevant sections in the report and should not

exceed thousand words.

The report should be structured and pages chronologically numbered generally, the

structure of a good repot is somewhat like the following:

• Introduction to the problem

• Marketing research finding or survey findings

• Interpretation of research finding

• Policy implications

4.8 PRICING RESEARCH

□ Pricing research is a method of research that measures and evaluates the impact of

changes in price of a product on its demand.

□ It is used by organizations to help determine an optimal price for new products, in order

to maximise revenue and market share.

□ This type of research is quantitative in nature.

There are two key benefits of conducting pricing research:

(i) the prediction of consumers' response to price changes, and

(ii) the discovery of psychological effects of price points on sales (demand

4.8.1 Methods of pricing research:

a) Van Westendorp Price Sensitivity Meter (PSM)

The Van Westendorp Price Sensitivity Meter constructs a range of acceptable price points for

a given product, determining the expected price range at which consumers will be willing to

purchase it. This range is constructed by having customers evaluate a product and then

respond to the following four questions:

• Too Expensive: "At what price would you begin to think this product is too expensive

to consider?"

• Expensive: "At what price would you begin to think this product is expensive but

worth considering?"

• Cheap: "At what price would you begin to think this product is a bargain?"

• Too Cheap:"At what price would you begin to think the product is so inexpensive that

you would question its quality?"

Once responses are collected, the cumulative frequency of the different answers are

charted in order to determine a series of acceptable price points.

These price points will range from a lower threshold to an upper threshold, and will also

include the optimal price point.

□ PSM is used to understand customers' pricing expectations, rather than their

willingness to pay or their likelihood to buy.

□ It is used to identify how much respondents would expecta product to cost.

b) Gabor-Granger Technique

The Gabor-Granger technique involves testing four to five different price points by

asking respondents their likelihood to purchase the product at each one of these

points.

Respondents indicate their likelihood to purchase at these predefined price points, and

this data is used to determine an optimal price point for the product within the

market. The Gabor-Granger technique asks respondents to evaluate predetermined

price points that have already been vetted by the company. It identifies the optimal

price range for a product, considering it in isolation.

c) Conjoint Analysis

Conjoint Analysis, also known as discrete choice analysis, is a pricing research technique that

is considered to be the most reliable way to determine the price of a product.

In this technique, respondents are given a choice of two to five product profiles, each with

different configurations. Respondents are asked to choose one of these profiles. The data

collected from respondents allows researchers to create pricing and packaging models that

are most likely to appeal to customers.

d) Brand-Price Trade-Off (BPTO)

BTPO, or Brand-Price Trade-Off, is a statistical tool that is used to identify the effect of price

on different areas such as profitability, revenue, market volume, and brand awareness. It is

a choice-based pricing technique that depicts consumers' differing preferences for brands

based on their pricing.

Survey respondents are shown a range of branded products, each with a price associated

with it. The range usually consists of 3 to 5 products. Consumers are then asked which

"offer" would be most appealing to them in a hypothetical buying scenario.

BPTO is useful in situations where you want to understand the relationship between a brand

and its prices.

4.9 Media Research

□ Media Research is the study of the effects of the different mass media on social,

psychological and physical aspects. □ Research segments the people based on what

television programs they watch, radio they listen, media they access and magazines they

read.

Parameters in Media Research

1. The nature of medium being used
2. The working of the medium
3. Technologies involved in it
4. Difference and similarities between it and other media vehicles
5. Functions and services provided by it
6. Cost associated and access to new medium
7. Effectiveness and how it can be improved
As decision process depends on data, thus media research has grown to be utilized for long
range planning. Research is in growth phase due to competitions between different media.
Importance of Media Research

1) Gives useful information: media research helps to understand and determine new
trends and get valuable insights into the field of mass media and communication,
which further enables to determine how more people can be reached within a short
span of time.

2) Helps frame news better: A thorough media research study helps to understand
how news can be framed better and make it more accessible to the target audience. It
helps in analysis and composition of views, news, and data.

3) Makes the (Message) story better and more accurate: Thorough media research
also helps to create more accurate and objectively apt stories. It is impossible to do so
if your efforts are not directed towards investigating each aspect of a story.

Steps involved in an extensive media research study:

● Pick a problem.
● Go through currently existing research and theories that are relevant.
● Come up with well-articulated research questions and a hypothesis or
hypotheses.
● Figure out an apt research design or algorithm and then gather relevant data.
● Conduct a thorough analysis of the results and determine their feasibility.
● Present those results in a structured format.
● Leverage the valuable insights of the study whenever it’s required.
4.9.1. Media Strategy:

□ The usage of the appropriate media mix in order to achieve desired and optimum

outcomes from the advertising campaign.

□ It plays a key role in advertising campaigns.

□ Media Strategy is not just about informing customers about products or services but also

placing right message towards the right people at the right time.

4.9.2 Importance of Media Strategy

□ 1. Location : Location is all about where to launch and run the campaign. Location

should be the one which gives maximum ROI. In current scenarios, online and offline

locations are both considered while deciding a media strategy.

□ 2. Budget: For deciding the media strategy, budget is very important. Every brand

wants to reach maximum target audience using all possible channels but
 that is not possible as everything costs money and we need to optimize costs and

hence the budget impacts the media strategy.

□ 3. Timing: Timing is an important aspect of media strategy. When to show the

messaging to the customers can make all the difference.

The timing of advertisement is very critical especially with respect to the seasonal

products.

□ 4. Channel: Channels and locations are quite similar in current context where

online media is very relevant but for conventional advertising and messaging, a lot of

channels like 1. TV; 2. Print; 3. Radio are still very relevant and used extensively in

the media strategy.

4.10 Qualitative Research:

Qualitative market research is an open ended questions((conversational) based

research method that heavily relies on the following market research methods:: focus

groups, in-depth interviews, and other innovative research methods. It is based on a

small but highly validated sample size, usually consisting of 6 to 10 respondents.

4.10.1 Qualitative research approaches

Approach What does it involve?

Grounded theory Researchers collect rich data on a topic of interest and

develop theories inductively.
Ethnography Researchers immerse themselves in groups or organizations
to understand their cultures.
Action research Researchers and participants collaboratively link theory to
practice to drive social change.
Phenomenological
research Researchers investigate a phenomenon or event by
describing and interpreting participants' lived experiences.
Narrative research
Researchers examine how stories are told to understand how
participants perceive and make sense of their experiences.
4.10.2 Qualitative research methods
Each of the research approaches involve using one or more data collection methods.
These are some of the most common qualitative methods:

• Observations: recording what you have seen, heard, or encountered in detailed field

notes.

• Interviews: personally asking people questions in one-on-one conversations.

• Focus groups: asking questions and generating discussion among a group of people.

• Surveys: distributing questionnaires with open-ended questions.

• Secondary research: collecting existing data in the form of texts, images, audio or video

recordings, etc.

4.10.3 Qualitative data analysis

Qualitative data can take the form of texts, photos, videos and audio. For example,

you might be working with interview transcripts, survey responses, fieldnotes, or

recordings from natural settings.

Most types of qualitative data analysis share the same five steps:

1. Prepare and organize your data. This may mean transcribing interviews or typing up

fieldnotes.

2. Review and explore your data. Examine the data for patterns or repeated ideas that

emerge.

3. Develop a data coding system. Based on your initial ideas, establish a set of codes that

you can apply to categorize your data.

4. Assign codes to the data. For example, in qualitative survey analysis, this may mean

going through each participant's responses and tagging them with codes in a spreadsheet.

As you go through your data, you can create new codes to add to your system if necessary.

5. Identify recurring themes. Link codes together into cohesive, overarching themes.
Advantages of qualitative research

Qualitative research often tries to preserve the voice and perspective of participants and can

be adjusted as new research questions arise. Qualitative research is good for:

• Flexibility

The data collection and analysis process can be adapted as new ideas or patterns emerge.

They are not rigidly decided beforehand.

• Natural settings

Data collection occurs in real-world contexts or in naturalistic ways.

• Meaningful insights

Detailed descriptions of people's experiences, feelings and perceptions can be used in

designing, testing or improving systems or products.

• Generation of new ideas

Open-ended responses mean that researchers can uncover novel problems or opportunities

that they wouldn't have thought of otherwise.

Disadvantages of qualitative research

Researchers must consider practical and theoretical limitations in analyzing and interpreting

their data. Qualitative research suffers from:

• Unreliability

The real-world setting often makes qualitative research unreliable because of uncontrolled

factors that affect the data.

• Subjectivity

Due to the researcher's primary role in analyzing and interpreting data, qualitative research

cannot be replicated. The researcher decides what is important and what is irrelevant in data

analysis, so interpretations of the same data can vary greatly.

• Limited generalizability

Small samples are often used to gather detailed data about specific contexts. Despite

rigorous analysis procedures, it is difficult to draw generalizable conclusions because the data

may be biased and unrepresentative of the wider population.

• Labor-intensive

Although software can be used to manage and record large amounts of text, data analysis

often has to be checked or performed manually.

 Unit IV – Multivariate analysis

• Use of various statistical tools – Descriptive & Inference Statistics, Statistical

Hypothesis Testing, Multivariate Analysis - Discriminant Analysis, Cluster Analysis,
Segmenting and Positioning, Factor Analysis
Use of various statistical tools

• Introduction: Market research relies heavily on statistical techniques in order to

bring more insights to the usual deliverables and outputs. Analysing the collected
data with basics tools is a fundamental aspect but sometimes a statistical
methodology can answer the client’s question in a better way.

• In the context of market research the researcher samples customers from

populations to establish their perception towards particular products and services,
or to identify purchasing behaviour so as to predict future preferences or buying
habits.

• The information gathered in these surveys can then be used to draw inference
about the wider population with a certain level of statistical confidence that the
results are accurate.

• A necessary prerequisite to conducting a survey, and subsequently to drawing

inference about a population, is to decide upon the best method of data collection.

• Data collection encompasses the fundamental areas of survey design and

sampling.

• Analysing the collected data is another fundamental aspect and can include any
number of statistical techniques.

• A broad understanding of numerical data and an ability to interpret graphical and

numerical descriptive measures is an important starting point for becoming
proficient at data collection, analysis and interpretation of results.

In this chapter, statistical techniques commonly used in a market research environment

to draw inference from survey data is discussed.
Descriptive statistics

Population Vs Sample

The image illustrates the concept of population and sample. Using random sample
measurements from a representative group, we can estimate, predict, or infer
characteristics about the larger population. While there are many technical
variations on this technique, they all follow the same underlying principles.

Descriptive Statistics:
❖Descriptive statistics are brief descriptive coefficients that summarize a given
data set, which can be either a representation of the entire population or a sample
of a population.
❖ The term ‘descriptive statistics’ can be used to describe both individual
quantitative observations (also known as ‘summary statistics’) as well as the
overall process of obtaining insights from these data.
❖Descriptive statistics may be used to describe both an entire population or an
individual sample.
❖Because they are merely explanatory, descriptive statistics are not heavily
concerned with the differences between the two types of data.
❖ Descriptive statistics are broken down into measures of central tendency and
measures of variability (spread).

❖ Measures of central tendency include the mean, median, and mode, while
measures of variability include standard deviation, variance, minimum and
maximum variables, kurtosis, and skewness.

❖ Descriptive statistics, describe and understand the features of a specific data set by
giving short summaries about the sample and measures of the data.

❖ The most recognized types of descriptive statistics are measures of center:

the mean, median, and mode, which are used at almost all levels of math and
statistics. The mean, or the average, is calculated by adding all the figures within
the data set and then dividing by the number of figures within the set.

I Measures of Central Tendency :

It is the middle point of a distribution. Tabulated data provides the data in a systematic
order and enhances their understanding. Generally, in any distribution values
of the variables tend to cluster around a central value of the distribution.
This tendency of the distribution is known as central tendency and
measures devised to consider this tendency is know as measures of
central tendency. A measure of central tendency is useful if it represents
accurately the distribution of scores on which it is based.
Characteristics of a good measure of central tendency :

• It should be clearly defined- The definition of a measure of central tendency

should be clear and unambiguous so that it leads to one and only one information.

• It should be readily comprehensible and easy to compute.

• It should be based on all observations- A good measure of central tendency should

be based on all the values of the distribution of scores.

• It should be amenable for further mathematical treatment.

• It should be least affected by the fluctuation of sampling.

In statistics there are three most commonly used measures of central tendency., viz.
Arithmetic Mean , Median, and Mode.

1) Arithmetic Mean: The arithmetic mean is most popular and widely used measure
of central tendency. This is obtained by dividing the sum of the values of the
variable by the number of values. It is also a useful measure for further statistics
and comparisons among different data sets.

One of the major limitations of arithmetic mean is that it cannot be

computed for open-ended class-intervals.

2) Median: Median is the middle most value in a data distribution. It divides the
distribution into two equal parts so that exactly one half of the observations is
below and one half is above that point. Since median clearly denotes the
position of an observation in an array, it is also called a position average.
Thus more technically, median of an array of numbers arranged in order of their
magnitude is either the middle value or the arithmetic mean of the two middle
values. It is not affected by extreme values in the distribution.

3) Mode: Mode is the value in a distribution that corresponds to the maximum

concentration of frequencies. It may be regarded as the most typical of a series
value. In more simple words, mode is the point in the distribution comprising
maximum frequencies therein
INFERENTIAL STATISTICS

• Inferential statistics is a branch of statistics that makes the use of various

analytical tools to draw inferences about the population data from sample
data. Inferential statistics help to draw conclusions about the population while
descriptive statistics summarizes the features of the data set.

• There are two main types of inferential statistics - hypothesis testing and
regression analysis.

• The samples chosen in inferential statistics need to be representative of the entire

population.

Types of Inferential Statistics

• Inferential statistics can be classified into hypothesis testing and regression

analysis. Hypothesis testing also includes the use of confidence intervals to test the
parameters of a population. Given below are the different types of inferential
statistics.

Hypothesis Testing

• Hypothesis testing is a type of inferential statistics that is used to test assumptions

and draw conclusions about the population from the available sample data. It
involves setting up a null hypothesis and an alternative hypothesis followed by
conducting a statistical test of significance. A conclusion is drawn based on the
value of the test statistic, the critical value, and the confidence intervals. A
hypothesis test can be left-tailed, right-tailed, and two-tailed.
Regression Analysis

• Regression analysis is used to quantify how one variable will change with respect
to another variable. There are many types of regressions available such as simple
linear, multiple linear, nominal, logistic, and ordinal regression. The most
commonly used regression in inferential statistics is linear regression. Linear
regression checks the effect of a unit change of the independent variable in the
dependent variable.
Inferential Statistics vs Descriptive Statistics
• Descriptive and inferential statistics are used to describe data and make
generalizations about the population from samples.

Inferential Statistics Descriptive Statistics

Inferential statistics are used to

Descriptive statistics are used to
make conclusions about the
quantify the characteristics of the
population by using analytical
data.
tools on the sample data.

Measures of central
Hypothesis testing and regression
tendency and measures of
analysis are the analytical tools
dispersion are the important tools
used.
used.

It is used to describe the

It is used to make inferences
characteristics of a known sample
about an unknown population
or population.

Measures of inferential statistics Measures of descriptive statistics

are t-test, z test, linear regression, are variance, range,
etc. mean, median, etc.
Hypothesis testing
• When interpreting research findings, researchers need to assess whether these findings
may have occurred by chance. Hypothesis testing is a systematic procedure for deciding
whether the results of a research study support a particular theory which applies to a
population.
• Hypothesis testing uses sample data to evaluate a hypothesis about a population. A
hypothesis test assesses how unusual the result is, whether it is reasonable chance
variation or whether the result is too extreme to be considered chance variation.
Hypothesis
• A hypothesis is a calculated prediction or assumption about a population parameter based
on limited evidence. The whole idea behind hypothesis formulation is testing—this means
the researcher subjects his or her calculated assumption to a series of evaluations to know
whether they are true or false.
• A null hypothesis is a statement, in which there is no relationship between two
variables. An alternative hypothesis is a statement; that is simply the inverse of
the null hypothesis, i.e. there is some statistical significance between two measured
phenomenon.

Stages of Hypothesis Testing

The five (5) stages of hypothesis testing are:

– Determine the null hypothesis

– Specify the alternative hypothesis

– Set the significance level

– Calculate the test statistics and corresponding P-value

– Draw your conclusion

Determine the Null Hypothesis

• Hypothesis testing starts with creating a null hypothesis which stands as an assumption

that a certain statement is false or implausible. For example, the null hypothesis (H0)

could suggest that different subgroups in the research population react to a variable in the

same way.
Specify the Alternative Hypothesis

• The next step is to determine the alternative hypothesis. The alternative

hypothesis counters the null assumption by suggesting the statement or assertion
is true. Depending on the purpose of the research, the alternative hypothesis can
be one-sided or two-sided.

Set the Significance Level

• Many researchers create a 5% allowance for accepting the value of an alternative

hypothesis, even if the value is untrue. This means that there is a 0.05 chance that
one would go with the value of the alternative hypothesis, despite the truth of the
null hypothesis.

• Smaller the significance level, the greater the burden of proof needed to reject the
null hypothesis and support the alternative hypothesis.

Calculate the Test Statistics and Corresponding P-Value

• Test statistics in hypothesis testing allows to compare different groups between

variables while the p-value accounts for the probability of obtaining sample
statistics if your null hypothesis is true. In this case, the test statistics can be the
mean, median and similar parameters.

• If the p-value is 0.65, for example, then it means that the variable in the
hypothesis will happen 65 in100 times by pure chance.

Draw Your Conclusions

• After conducting a series of tests, the researcher will agree or refute the
hypothesis based on feedback and insights from the sample data.
Applications of Hypothesis Testing in Research

Hypothesis testing isn't only confined to numbers and calculations; it also has several
real-life applications in business, manufacturing, advertising, and medicine.

• In a factory or other manufacturing plants, hypothesis testing is an important part

of quality and production control before the final products are approved and sent
out to the consumer.

• During ideation and strategy development, C-level executives use hypothesis

testing to evaluate their theories and assumptions before any form of
implementation. For example, they could leverage hypothesis testing to determine
whether or not some new advertising campaign, marketing technique, etc. causes
increased sales.

• In addition, hypothesis testing is used during clinical trials to prove the efficacy of
a drug or new medical method before its approval for widespread human usage.

Importance/Benefits of Hypothesis Testing

Other benefits include:

• Hypothesis testing provides a reliable framework for making any data decisions for
your population of interest.

• It helps the researcher to successfully extrapolate data from the sample to the
larger population.

• Hypothesis testing allows the researcher to determine whether the data from the
sample is statistically significant.

• Hypothesis testing is one of the most important processes for measuring the
validity and reliability of outcomes in any systematic investigation.

• It helps to provide links to the underlying theory and specific research questions.
MULTI VARIATE ANALYSIS
Introduction

Multivariate means involving multiple dependent variables resulting in one outcome.

This explains that the majority of the problems in the real world are
Multivariate. For example, we cannot predict the weather of any year based on
the season. There are multiple factors like pollution, humidity, precipitation, etc.
Here, we will introduce you to multivariate analysis, its history, and its application
in different fields.

Multivariate analysis (MVA) is a Statistical procedure for analysis of data involving

more than one type of measurement or observation. It may also mean solving
problems where more than one dependent variable is analyzed simultaneously with
other variables.

Advantages of Multivariate Analysis

• The main advantage of multivariate analysis is that since it considers more than
one factor of independent variables that influence the variability of
dependent variables, the conclusion drawn is more accurate.

• The conclusions are more realistic and nearer to the real-life situation.

Disadvantages of Multivariate Analysis

• The main disadvantage of MVA includes that it requires rather complex

computations to arrive at a satisfactory conclusion.

• Many observations for a large number of variables need to be collected and

tabulated; it is a rather time-consuming process.
Classification of Multivariate Techniques

• Multivariate analysis technique can be classified into two broad categories viz., This
classification depends upon the question: are the involved variables dependent on
each other or not?

• If the answer is yes: Dependence methods.

If the answer is no: Interdependence methods.

Dependence technique: Dependence Techniques are types of multivariate analysis

techniques that are used when one or more of the variables can be identified as
dependent variables and the remaining variables can be identified as independent.

Interdependence Technique

• Interdependence techniques are a type of relationship that variables cannot be

classified as either dependent or independent.

• It aims to unravel relationships between variables and/or subjects without explicitly

assuming specific distributions for the variables. The idea is to describe the
patterns in the data without making (very) strong assumptions about the
variables.
Factor Analysis

• Factor analysis is a way to condense the data in many variables into just a few
variables.

• It is also sometimes called “dimension reduction”.

• It makes the grouping of variables with high correlation.

• Factor analysis includes techniques such as principal component analysis and

common factor analysis.

• This type of technique is used as a pre-processing step to transform the data

before using other models.

• When the data has too many variables, the performance of multivariate techniques
is not at the optimum level, as patterns are more difficult to find.

• By using factor analysis, the patterns become less diluted and easier to analyze.

Objectives of factor analysis

• To definitively understand how many factors are needed to explain common

themes amongst a given set of variables.

• To determine the extent to which each variable in the dataset is associated with a
common theme or factor.

• To provide an interpretation of the common factors in the dataset.

• To determine the degree to which each observed data point represents each
theme or factor.

Forms of Factor Analysis

• Exploratory Factor Analysis should be used when you need to develop a

hypothesis about a relationship between variables.

• Confirmatory Factor Analysis should be used to test a hypothesis about the

relationship between variables.

• Construct Validity should be used to test the degree to which your survey
actually measures what it is intended to measure.
Assumptions:
• No outlier: Assume that there are no outliers in data.
• Adequate sample size: The case must be greater than the factor.
• No perfect multicollinearity: Factor analysis is an interdependency
technique. There should not be perfect multicollinearity between the variables.
• Homoscedasticity: Since factor analysis is a linear function of measured
variables, it does not require homoscedasticity between the variables.
• Linearity: Factor analysis is also based on linearity assumption. Non-linear
variables can also be used. After transfer, however, it changes into linear variable.
• Interval Data: Interval data are assumed.

Types of factoring:
There are different types of methods used to extract the factor from the data set:
1. Principal component analysis: This is the most common method used by
researchers. PCA starts extracting the maximum variance and puts them into the
first factor. After that, it removes that variance explained by the first factors and
then starts extracting maximum variance for the second factor. This process goes
to the last factor.
2. Common factor analysis: The second most preferred method by researchers, it
extracts the common variance and puts them into factors. This method does not
include the unique variance of all variables. This method is used in SEM.
3. Image factoring: This method is based on correlation matrix. OLS Regression
method is used to predict the factor in image factoring.
4. Maximum likelihood method: This method also works on correlation metric but it
uses maximum likelihood method to factor.
5. Other methods of factor analysis: Alfa factoring outweighs least squares. Weight
square is another regression based method which is used for factoring.

Factor loading:
Factor loading is basically the correlation coefficient for the variable and factor. Factor
loading shows the variance explained by the variable on that particular factor.
• Eigenvalues: Eigenvalues is also called characteristic roots. Eigenvalues shows
variance explained by that particular factor out of the total variance.

For example, if our first factor explains 68% variance out of the total,
this means that 32% variance will be explained by the other factor.

• Factor score: The factor score is also called the component score. This score is
of all row and columns, which can be used as an index of all variables and can be
used for further analysis.

Criteria for determining the number of factors:

• Eigenvalues is a good criteria for determining a factor.

• If Eigenvalues is greater than one, we should consider that a factor and if

Eigenvalues is less than one, then we should not consider that a factor.

• According to the variance extraction rule, it should be more than 0.7. If variance is
less than 0.7, then we should not consider that a factor.

• Rotation method: Rotation method makes it more reliable to understand the

output. Eigenvalues do not affect the rotation method, but the rotation method
affects the Eigenvalues or percentage of variance extracted. There are a number
of rotation methods available: (1) No rotation method, (2) Varimax rotation
method, (3) Quartimax rotation method, (4) Direct oblimin rotation method, and
(5) Promax rotation method.

• Each of these can be easily selected in SPSS, and we can compare our variance
explained by those particular methods.

STEP by STEP procedure

Cluster analysis

• Cluster analysis is a statistical method used to group similar objects into respective
categories. It can also be referred to as segmentation analysis, taxonomy analysis,
or clustering.

• The goal of performing a cluster analysis is to sort different objects or data points
into groups in a manner that the degree of association between two objects is high
if they belong to the same group, and low if they belong to different groups.

• Cluster analysis differs from many other statistical methods due to the fact that it’s
mostly used when researchers do not have an assumed principle or fact that they
are using as the foundation of their research.

• It doesn’t make any distinction between dependent and independent variables.

Instead, cluster analysis is leveraged mostly to discover structures in data without
providing an explanation or interpretation.

• Put simply, cluster analysis discovers structures in data without explaining why
those structures exist.

• For example, when cluster analysis is performed as part of market research,

specific groups can be identified within a population. The analysis of these groups
can then determine how likely a population cluster is to purchase products or
services. If these groups are defined clearly, a marketing team can then target
varying cluster with tailored, targeted communication.

• Common Applications of Cluster Analysis

• Marketing

• Marketers commonly use cluster analysis to develop market segments, which allow
for better positioning of products and messaging. company to better position
itself, explore new markets, and development products that specific clusters find
relevant and valuable.
• Insurance
• Insurance companies often leverage cluster analysis if there are a high number of
claims in a given region. This enables them to learn exactly what is driving this
increase in claims.
• Geology
• For cities on fault lines, geologists use cluster analysis to evaluate seismic risk and
the potential weaknesses of earthquake-prone regions. By considering the results
of this research, residents can do their best to prepare mitigate potential damage.
The Benefits of Cluster Analysis
• Clustering allows researchers to identify and define patterns between data
elements.
• Revealing these patterns between data points helps to distinguish and outline
structures which might not have been apparent before, but which give significant
meaning to the data once they are discovered.
• Once a clearly defined structure emerges from the dataset at hand, informed
decision-making becomes much easier.
The Different Types of Cluster Analysis
There are three primary methods used to perform cluster analysis:
• Hierarchical Cluster : This is the most common method of clustering. It creates
a series of models with cluster solutions from 1 (all cases in one cluster) to n (each
case is an individual cluster). This approach also works with variables instead of
cases.
• Finally, hierarchical cluster analysis can handle nominal, ordinal, and scale data.
But, remember not to mix different levels of measurement into your study.
K-Means Cluster
• This method is used to quickly cluster large datasets. Here, researchers define the
number of clusters prior to performing the actual study. This approach is useful
when testing different models with a different assumed number of clusters.
Two-Step Cluster

• This method uses a cluster algorithm to identify groupings by performing pre-

clustering first, and then performing hierarchical methods. Two-step clustering is
best for handling larger datasets that would otherwise take too long a time to
calculate with strictly hierarchical methods.

• Essentially, two-step cluster analysis is a combination of hierarchical and k-means

cluster analysis. It can handle both scale and ordinal data, and it automatically
selects the number of clusters.
Discriminant Analysis
• Discriminant analysis is a technique that is used by the researcher to analyze the
research data when the criterion or the dependent variable is categorical and the
predictor or the independent variable is interval in nature. The term categorical
variable means that the dependent variable is divided into a number of categories.

Discriminant analysis is statistical technique used to classify observations into non-

overlapping groups, based on scores on one or more quantitative predictor
variables.

• Objectives

– Development of discriminant functions

– Examination of whether significant differences exist among the groups, in

terms of the predictor variables.

– Determination of which predictor variables contribute to most of the

intergroup differences

– Evaluation of the accuracy of classification

DA involves the determination of a linear equation like regression that will predict which
group the case belongs to.

The form of the equation or function is:

D= v1 X1+ v2 X2+ v3X3+ ... + viXi + a

• Where D = discriminate function

• v = the discriminant coefficient or weight for that variable

• X = respondent’s score for that variable 2

• a = a constant

• i = the number of predictor variables

Applications (Examples)

1. An educational researcher may want to investigate which variables discriminate

between high school graduates who decide (1) to go to college, (2) to attend a
trade or professional school, or (3) to seek no further training or education. For
that purpose the researcher could collect data on numerous variables prior to
students' graduation. After graduation, most students will naturally fall into one of
the three categories.

Discriminant Analysis could then be used to determine which variable(s) are the
best predictors of students' subsequent educational choice.

2. A medical researcher may record different variables relating to patients'

backgrounds in order to learn which variables best predict whether a patient is
likely to recover completely (group 1), partially (group 2), or not at all (group 3). A
biologist could record different characteristics of similar types (groups) of flowers,
and then perform a discriminant function analysis to determine the set of
characteristics that allows for the best discrimination between the types.
 Unit IV – Multivariate analysis

● Use of various statistical tools – Descriptive & Inference Statistics, Statistical

Hypothesis Testing, Multivariate Analysis - Discriminant Analysis, Cluster Analysis,
Segmenting and Positioning, Factor Analysis
Use of various statistical tools

● Introduction: Market research relies heavily on statistical techniques in order to

bring more insights to the usual deliverables and outputs. Analysing the collected
data with basics tools is a fundamental aspect but sometimes a statistical
methodology can answer the client’s question in a better way.

● In the context of market research the researcher samples customers from

populations to establish their perception towards particular products and services,
or to identify purchasing behaviour so as to predict future preferences or buying
habits.

● The information gathered in these surveys can then be used to draw inference
about the wider population with a certain level of statistical confidence that the
results are accurate.

● A necessary prerequisite to conducting a survey, and subsequently to drawing

inference about a population, is to decide upon the best method of data collection.

● Data collection encompasses the fundamental areas of survey design and

sampling.

● Analysing the collected data is another fundamental aspect and can include any
number of statistical techniques.

● A broad understanding of numerical data and an ability to interpret graphical and

numerical descriptive measures is an important starting point for becoming
proficient at data collection, analysis and interpretation of results.

In this chapter, statistical techniques commonly used in a market research environment

to draw inference from survey data is discussed.
Descriptive statistics

Population Vs Sample

The image illustrates the concept of population and sample. Using random sample
measurements from a representative group, we can estimate, predict, or infer
characteristics about the larger population. While there are many technical
variations on this technique, they all follow the same underlying principles.

Descriptive Statistics:
❖Descriptive statistics are brief descriptive coefficients that summarize a given
data set, which can be either a representation of the entire population or a sample
of a population.
❖ The term ‘descriptive statistics’ can be used to describe both individual
quantitative observations (also known as ‘summary statistics’) as well as the
overall process of obtaining insights from these data.
❖Descriptive statistics may be used to describe both an entire population or an
individual sample.
❖Because they are merely explanatory, descriptive statistics are not heavily
concerned with the differences between the two types of data.
❖ Descriptive statistics are broken down into measures of central tendency and
measures of variability (spread).

❖ Measures of central tendency include the mean, median, and mode, while
measures of variability include standard deviation, variance, minimum and
maximum variables, kurtosis, and skewness.

❖ Descriptive statistics, describe and understand the features of a specific data set by
giving short summaries about the sample and measures of the data.

❖ The most recognized types of descriptive statistics are measures of center:

the mean, median, and mode, which are used at almost all levels of math and
statistics. The mean, or the average, is calculated by adding all the figures within
the data set and then dividing by the number of figures within the set.

I Measures of Central Tendency :

It is the middle point of a distribution. Tabulated data provides the data in a systematic
order and enhances their understanding. Generally, in any distribution values
of the variables tend to cluster around a central value of the distribution.
This tendency of the distribution is known as central tendency and
measures devised to consider this tendency is know as measures of
central tendency. A measure of central tendency is useful if it represents
accurately the distribution of scores on which it is based.
Characteristics of a good measure of central tendency :

● It should be clearly defined- The definition of a measure of central tendency

should be clear and unambiguous so that it leads to one and only one information.

● It should be readily comprehensible and easy to compute.

● It should be based on all observations- A good measure of central tendency should

be based on all the values of the distribution of scores.

● It should be amenable for further mathematical treatment.

● It should be least affected by the fluctuation of sampling.

In statistics there are three most commonly used measures of central tendency., viz.
Arithmetic Mean , Median, and Mode.

1) Arithmetic Mean: The arithmetic mean is most popular and widely used measure
of central tendency. This is obtained by dividing the sum of the values of the
variable by the number of values. It is also a useful measure for further statistics
and comparisons among different data sets.

One of the major limitations of arithmetic mean is that it cannot be

computed for open-ended class-intervals.

2) Median: Median is the middle most value in a data distribution. It divides the
distribution into two equal parts so that exactly one half of the observations is
below and one half is above that point. Since median clearly denotes the
position of an observation in an array, it is also called a position average.
Thus more technically, median of an array of numbers arranged in order of their
magnitude is either the middle value or the arithmetic mean of the two middle
values. It is not affected by extreme values in the distribution.

3) Mode: Mode is the value in a distribution that corresponds to the maximum

concentration of frequencies. It may be regarded as the most typical of a series
value. In more simple words, mode is the point in the distribution comprising
maximum frequencies therein
INFERENTIAL STATISTICS

● Inferential statistics is a branch of statistics that makes the use of various

analytical tools to draw inferences about the population data from sample
data. Inferential statistics help to draw conclusions about the population while
descriptive statistics summarizes the features of the data set.

● There are two main types of inferential statistics - hypothesis testing and
regression analysis.

● The samples chosen in inferential statistics need to be representative of the entire

population.

Types of Inferential Statistics

● Inferential statistics can be classified into hypothesis testing and regression

analysis. Hypothesis testing also includes the use of confidence intervals to test the
parameters of a population. Given below are the different types of inferential
statistics.

Hypothesis Testing

● Hypothesis testing is a type of inferential statistics that is used to test assumptions

and draw conclusions about the population from the available sample data. It
involves setting up a null hypothesis and an alternative hypothesis followed by
conducting a statistical test of significance. A conclusion is drawn based on the
value of the test statistic, the critical value, and the confidence intervals. A
hypothesis test can be left-tailed, right-tailed, and two-tailed.
Regression Analysis

● Regression analysis is used to quantify how one variable will change with respect
to another variable. There are many types of regressions available such as simple
linear, multiple linear, nominal, logistic, and ordinal regression. The most
commonly used regression in inferential statistics is linear regression. Linear
regression checks the effect of a unit change of the independent variable in the
dependent variable.
Inferential Statistics vs Descriptive Statistics
● Descriptive and inferential statistics are used to describe data and make
generalizations about the population from samples.

Inferential Statistics Descriptive Statistics

Inferential statistics are used to

Descriptive statistics are used to
make conclusions about the
quantify the characteristics of the
population by using analytical
data.
tools on the sample data.

Measures of central
Hypothesis testing and regression
tendency and measures of
analysis are the analytical tools
dispersion are the important tools
used.
used.

It is used to describe the

It is used to make inferences
characteristics of a known sample
about an unknown population
or population.

Measures of inferential statistics Measures of descriptive statistics

are t-test, z test, linear regression, are variance, range,
etc. mean, median, etc.
Hypothesis testing
● When interpreting research findings, researchers need to assess whether these findings
may have occurred by chance. Hypothesis testing is a systematic procedure for deciding
whether the results of a research study support a particular theory which applies to a
population.
● Hypothesis testing uses sample data to evaluate a hypothesis about a population. A
hypothesis test assesses how unusual the result is, whether it is reasonable chance
variation or whether the result is too extreme to be considered chance variation.
Hypothesis
● A hypothesis is a calculated prediction or assumption about a population parameter based
on limited evidence. The whole idea behind hypothesis formulation is testing—this means
the researcher subjects his or her calculated assumption to a series of evaluations to know
whether they are true or false.
● A null hypothesis is a statement, in which there is no relationship between two
variables. An alternative hypothesis is a statement; that is simply the inverse of
the null hypothesis, i.e. there is some statistical significance between two measured
phenomenon.

Stages of Hypothesis Testing

The five (5) stages of hypothesis testing are:

○ Determine the null hypothesis

○ Specify the alternative hypothesis

○ Set the significance level

○ Calculate the test statistics and corresponding P-value

○ Draw your conclusion

Determine the Null Hypothesis

● Hypothesis testing starts with creating a null hypothesis which stands as an assumption

that a certain statement is false or implausible. For example, the null hypothesis (H0)

could suggest that different subgroups in the research population react to a variable in the

same way.
Specify the Alternative Hypothesis

● The next step is to determine the alternative hypothesis. The alternative

hypothesis counters the null assumption by suggesting the statement or assertion
is true. Depending on the purpose of the research, the alternative hypothesis can
be one-sided or two-sided.

Set the Significance Level

● Many researchers create a 5% allowance for accepting the value of an alternative

hypothesis, even if the value is untrue. This means that there is a 0.05 chance that
one would go with the value of the alternative hypothesis, despite the truth of the
null hypothesis.

● Smaller the significance level, the greater the burden of proof needed to reject the
null hypothesis and support the alternative hypothesis.

Calculate the Test Statistics and Corresponding P-Value

● Test statistics in hypothesis testing allows to compare different groups between

variables while the p-value accounts for the probability of obtaining sample
statistics if your null hypothesis is true. In this case, the test statistics can be the
mean, median and similar parameters.

● If the p-value is 0.65, for example, then it means that the variable in the
hypothesis will happen 65 in100 times by pure chance.

Draw Your Conclusions

● After conducting a series of tests, the researcher will agree or refute the
hypothesis based on feedback and insights from the sample data.
Applications of Hypothesis Testing in Research

Hypothesis testing isn't only confined to numbers and calculations; it also has several
real-life applications in business, manufacturing, advertising, and medicine.

● In a factory or other manufacturing plants, hypothesis testing is an important part

of quality and production control before the final products are approved and sent
out to the consumer.

● During ideation and strategy development, C-level executives use hypothesis

testing to evaluate their theories and assumptions before any form of
implementation. For example, they could leverage hypothesis testing to determine
whether or not some new advertising campaign, marketing technique, etc. causes
increased sales.

● In addition, hypothesis testing is used during clinical trials to prove the efficacy of
a drug or new medical method before its approval for widespread human usage.

Importance/Benefits of Hypothesis Testing

Other benefits include:

● Hypothesis testing provides a reliable framework for making any data decisions for
your population of interest.

● It helps the researcher to successfully extrapolate data from the sample to the
larger population.

● Hypothesis testing allows the researcher to determine whether the data from the
sample is statistically significant.

● Hypothesis testing is one of the most important processes for measuring the
validity and reliability of outcomes in any systematic investigation.

● It helps to provide links to the underlying theory and specific research questions.
MULTI VARIATE ANALYSIS
Introduction

Multivariate means involving multiple dependent variables resulting in one outcome.

This explains that the majority of the problems in the real world are
Multivariate. For example, we cannot predict the weather of any year based on
the season. There are multiple factors like pollution, humidity, precipitation, etc.
Here, we will introduce you to multivariate analysis, its history, and its application
in different fields.

Multivariate analysis (MVA) is a Statistical procedure for analysis of data involving

more than one type of measurement or observation. It may also mean solving
problems where more than one dependent variable is analyzed simultaneously with
other variables.

Advantages of Multivariate Analysis

● The main advantage of multivariate analysis is that since it considers more than
one factor of independent variables that influence the variability of
dependent variables, the conclusion drawn is more accurate.

● The conclusions are more realistic and nearer to the real-life situation.

Disadvantages of Multivariate Analysis

● The main disadvantage of MVA includes that it requires rather complex

computations to arrive at a satisfactory conclusion.

● Many observations for a large number of variables need to be collected and

tabulated; it is a rather time-consuming process.
Classification of Multivariate Techniques

● Multivariate analysis technique can be classified into two broad categories viz., This
classification depends upon the question: are the involved variables dependent on
each other or not?

● If the answer is yes: Dependence methods.

If the answer is no: Interdependence methods.

Dependence technique: Dependence Techniques are types of multivariate analysis

techniques that are used when one or more of the variables can be identified as
dependent variables and the remaining variables can be identified as independent.

Interdependence Technique

● Interdependence techniques are a type of relationship that variables cannot be

classified as either dependent or independent.

● It aims to unravel relationships between variables and/or subjects without explicitly

assuming specific distributions for the variables. The idea is to describe the
patterns in the data without making (very) strong assumptions about the
variables.
Factor Analysis

● Factor analysis is a way to condense the data in many variables into just a few
variables.

● It is also sometimes called “dimension reduction”.

● It makes the grouping of variables with high correlation.

● Factor analysis includes techniques such as principal component analysis and

common factor analysis.

● This type of technique is used as a pre-processing step to transform the data

before using other models.

● When the data has too many variables, the performance of multivariate techniques
is not at the optimum level, as patterns are more difficult to find.

● By using factor analysis, the patterns become less diluted and easier to analyze.

Objectives of factor analysis

● To definitively understand how many factors are needed to explain common

themes amongst a given set of variables.

● To determine the extent to which each variable in the dataset is associated with a
common theme or factor.

● To provide an interpretation of the common factors in the dataset.

● To determine the degree to which each observed data point represents each
theme or factor.

Forms of Factor Analysis

● Exploratory Factor Analysis should be used when you need to develop a

hypothesis about a relationship between variables.

● Confirmatory Factor Analysis should be used to test a hypothesis about the

relationship between variables.

● Construct Validity should be used to test the degree to which your survey
actually measures what it is intended to measure.
Assumptions:
● No outlier: Assume that there are no outliers in data.
● Adequate sample size: The case must be greater than the factor.
● No perfect multicollinearity: Factor analysis is an interdependency
technique. There should not be perfect multicollinearity between the variables.
● Homoscedasticity: Since factor analysis is a linear function of measured
variables, it does not require homoscedasticity between the variables.
● Linearity: Factor analysis is also based on linearity assumption. Non-linear
variables can also be used. After transfer, however, it changes into linear variable.
● Interval Data: Interval data are assumed.

Types of factoring:
There are different types of methods used to extract the factor from the data set:
1. Principal component analysis: This is the most common method used by
researchers. PCA starts extracting the maximum variance and puts them into the
first factor. After that, it removes that variance explained by the first factors and
then starts extracting maximum variance for the second factor. This process goes
to the last factor.
2. Common factor analysis: The second most preferred method by researchers, it
extracts the common variance and puts them into factors. This method does not
include the unique variance of all variables. This method is used in SEM.
3. Image factoring: This method is based on correlation matrix. OLS Regression
method is used to predict the factor in image factoring.
4. Maximum likelihood method: This method also works on correlation metric but it
uses maximum likelihood method to factor.
5. Other methods of factor analysis: Alfa factoring outweighs least squares. Weight
square is another regression based method which is used for factoring.

Factor loading:
Factor loading is basically the correlation coefficient for the variable and factor. Factor
loading shows the variance explained by the variable on that particular factor.
● Eigenvalues: Eigenvalues is also called characteristic roots. Eigenvalues shows
variance explained by that particular factor out of the total variance.

For example, if our first factor explains 68% variance out of the total,
this means that 32% variance will be explained by the other factor.

● Factor score: The factor score is also called the component score. This score is
of all row and columns, which can be used as an index of all variables and can be
used for further analysis.

Criteria for determining the number of factors:

● Eigenvalues is a good criteria for determining a factor.

● If Eigenvalues is greater than one, we should consider that a factor and if

Eigenvalues is less than one, then we should not consider that a factor.

● According to the variance extraction rule, it should be more than 0.7. If variance is
less than 0.7, then we should not consider that a factor.

● Rotation method: Rotation method makes it more reliable to understand the

output. Eigenvalues do not affect the rotation method, but the rotation method
affects the Eigenvalues or percentage of variance extracted. There are a number
of rotation methods available: (1) No rotation method, (2) Varimax rotation
method, (3) Quartimax rotation method, (4) Direct oblimin rotation method, and
(5) Promax rotation method.

● Each of these can be easily selected in SPSS, and we can compare our variance
explained by those particular methods.

STEP by STEP procedure

Cluster analysis

● Cluster analysis is a statistical method used to group similar objects into respective
categories. It can also be referred to as segmentation analysis, taxonomy analysis,
or clustering.

● The goal of performing a cluster analysis is to sort different objects or data points
into groups in a manner that the degree of association between two objects is high
if they belong to the same group, and low if they belong to different groups.

● Cluster analysis differs from many other statistical methods due to the fact that it’s
mostly used when researchers do not have an assumed principle or fact that they
are using as the foundation of their research.

● It doesn’t make any distinction between dependent and independent variables.

Instead, cluster analysis is leveraged mostly to discover structures in data without
providing an explanation or interpretation.

● Put simply, cluster analysis discovers structures in data without explaining why
those structures exist.

● For example, when cluster analysis is performed as part of market research,

specific groups can be identified within a population. The analysis of these groups
can then determine how likely a population cluster is to purchase products or
services. If these groups are defined clearly, a marketing team can then target
varying cluster with tailored, targeted communication.

● Common Applications of Cluster Analysis

● Marketing

● Marketers commonly use cluster analysis to develop market segments, which allow
for better positioning of products and messaging. company to better position
itself, explore new markets, and development products that specific clusters find
relevant and valuable.
● Insurance
● Insurance companies often leverage cluster analysis if there are a high number of
claims in a given region. This enables them to learn exactly what is driving this
increase in claims.
● Geology
● For cities on fault lines, geologists use cluster analysis to evaluate seismic risk and
the potential weaknesses of earthquake-prone regions. By considering the results
of this research, residents can do their best to prepare mitigate potential damage.
The Benefits of Cluster Analysis
● Clustering allows researchers to identify and define patterns between data
elements.
● Revealing these patterns between data points helps to distinguish and outline
structures which might not have been apparent before, but which give significant
meaning to the data once they are discovered.
● Once a clearly defined structure emerges from the dataset at hand, informed
decision-making becomes much easier.
The Different Types of Cluster Analysis
There are three primary methods used to perform cluster analysis:
● Hierarchical Cluster : This is the most common method of clustering. It creates
a series of models with cluster solutions from 1 (all cases in one cluster) to n (each
case is an individual cluster). This approach also works with variables instead of
cases.
● Finally, hierarchical cluster analysis can handle nominal, ordinal, and scale data.
But, remember not to mix different levels of measurement into your study.
K-Means Cluster
● This method is used to quickly cluster large datasets. Here, researchers define the
number of clusters prior to performing the actual study. This approach is useful
when testing different models with a different assumed number of clusters.
Two-Step Cluster

● This method uses a cluster algorithm to identify groupings by performing pre-

clustering first, and then performing hierarchical methods. Two-step clustering is
best for handling larger datasets that would otherwise take too long a time to
calculate with strictly hierarchical methods.

● Essentially, two-step cluster analysis is a combination of hierarchical and k-means

cluster analysis. It can handle both scale and ordinal data, and it automatically
selects the number of clusters.
Discriminant Analysis
● Discriminant analysis is a technique that is used by the researcher to analyze the
research data when the criterion or the dependent variable is categorical and the
predictor or the independent variable is interval in nature. The term categorical
variable means that the dependent variable is divided into a number of categories.

Discriminant analysis is statistical technique used to classify observations into non-

overlapping groups, based on scores on one or more quantitative predictor
variables.

● Objectives

○ Development of discriminant functions

○ Examination of whether significant differences exist among the groups, in

terms of the predictor variables.

○ Determination of which predictor variables contribute to most of the

intergroup differences

○ Evaluation of the accuracy of classification

DA involves the determination of a linear equation like regression that will predict which
group the case belongs to.

The form of the equation or function is:

D= v1 X1+ v2 X2+ v3X3+ ... + viXi + a

● Where D = discriminate function

● v = the discriminant coefficient or weight for that variable

● X = respondent’s score for that variable 2

● a = a constant

● i = the number of predictor variables

Applications (Examples)

1. An educational researcher may want to investigate which variables discriminate

between high school graduates who decide (1) to go to college, (2) to attend a
trade or professional school, or (3) to seek no further training or education. For
that purpose the researcher could collect data on numerous variables prior to
students' graduation. After graduation, most students will naturally fall into one of
the three categories.

Discriminant Analysis could then be used to determine which variable(s) are the
best predictors of students' subsequent educational choice.

2. A medical researcher may record different variables relating to patients'

backgrounds in order to learn which variables best predict whether a patient is
likely to recover completely (group 1), partially (group 2), or not at all (group 3). A
biologist could record different characteristics of similar types (groups) of flowers,
and then perform a discriminant function analysis to determine the set of
characteristics that allows for the best discrimination between the types.
 8. ASSIGNMENT : UNIT – IV

1. Case study – Any household product perform market research by

collecting the questionnaire

2. Discuss in detail about two statistical tools used for Data Analysis

67
 9. PART A : UNIT – IV

1 CO4 K1
Define Marketing Research

2 CO4 K1
State how marketing research can be done?
3 CO4 K1
List the applications of marketing research.

4 CO4 K1
Define hypothesis
5 CO4 K1
List the types of Research design
6 CO4 K1
List the data collection techniques available
7 CO4 K1
List the different types of scales available in the
measurement of Attitudes in MR
8 CO4 K1
List the components of Intelligence systems

9 CO4 K1
Define Data Mining
10 CO4 K1
Define Data Warehousing

11 CO4 K1
Define DCOVA

12 CO4 K2
Compare and contrast different variables available

13 CO4 K2
Compare and contrast structured and unstructured data

14 CO4 K1
List the various Regression Methods available

15 CO4 K1
What is the hypothesis testing?

16 CO4 K2
Illustrate the purpose of Inference Statistics

17 CO4 K1
Define Factor Analysis

18 CO4 K1
Define Cluster Analysis

19 What is confidence level? CO4 K1

The confidence level in hypothesis testing is the
probability of acceptance of null hypothesis H0 when the
null hypothesis is true
20 What does a 95% confidence interval mean? CO4 K1
The 95% confidence interval is a range of values that
you can be 95% confident contains the true mean of the
population.
 10. PART B & C : UNIT – IV

1 Describe the data mining and data warehousing CO4 K2

2 CO4 K2
Describe the marketing research process

3 CO4 K2
What issues will be considered while designing a questionnaire for
accessing the distribution equity of a well known national brand of
soap? Design a Questionnaire to measure distribution equity.
4 CO4 K2
Explain in detail about Hypothesis Testing

5 CO4 K2
Explain in detail about Cluster Analysis

6 CO4 K1
Explain in detail about Factor Analysis

69
 11. Supportive online Certification courses

NPTEL: [Link]
Swayam:[Link]
coursera : [Link]

70 53
 12. REAL TIME APPLICATIONS – CASE STUDY :
UNIT – IV

• Physicians’ Reactions to the Size of a Patient

• Overweight and obesity is common in many of the developed contrives. In

some cultures, obese individuals face discrimination in employment,
education, and relationship contexts. The current research, conducted by
Mikki Hebl and Jingping Xu, examines physicians’ attitude toward overweight
and obese patients in comparison to their attitude toward patients who are
not overweight.

• The experiment included a total of 122 primary care physicians affiliated with
one of three major hospitals in the Texas Medical Center of Houston. These
physicians were sent a packet containing a medical chart similar to the one
they view upon seeing a patient. This chart portrayed a patient who was
displaying symptoms of a migraine headache but was otherwise healthy. Two
variables (the gender and the weight of the patient) were manipulated across
six different versions of the medical charts. The weight of the patient,
described in terms of Body Mass Index (BMI), was average (BMI = 23),
overweight (BMI = 30), or obese (BMI = 36). Physicians were randomly
assigned to receive one of the six charts, and were asked to look over the
chart carefully and complete two medical forms. The first form asked
physicians which of 42 tests they would recommend giving to the patient. The
second form asked physicians to indicate how much time they believed they
would spend with the patient, and to describe the reactions that they would
have toward this patient.

• In this presentation, only the question on how much time the physicians
believed they would spend with the patient is analyzed. Although three
patient weight conditions were used in the study (average, overweight, and
obese) only the average and overweight conditions will be analyzed.
Therefore, there are two levels of patient weight (average and overweight)
and one dependent variable (time spent).
 12. REAL TIME APPLICATIONS – CASE STUDY :
UNIT – IV

• The data for the given collection of responses from 72 primary care
physicians is stored in the file “[Link]”. We start by reading the
content of the file into a data frame by the name “patient” and presenting the
summary of the variables:

• patient <- [Link]("_data/[Link]") summary(patient)## weight

time ## BMI=23:33 Min. : 5.00 ## BMI=30:38 1st Qu.:20.00 ## Median
:30.00 ## Mean :27.82 ## 3rd Qu.:30.00 ## Max. :60.00Observe that of the
72 “patients”, 38 are overweight and 33 have an average weight. The time
spend with the patient, as predicted by physicians, is distributed between 5
minutes and 1 hour, with a average of 27.82 minutes and a median of 30
minutes.

• It is a good practice to have a look at the data before doing the analysis. In
this examination on should see that the numbers make sense and one should
identify special features of the data. Even in this very simple example we may
want to have a look at the histogram of the variable “time”:

• hist(patient$time)

• A feature in this plot that catches attention is the fact that there is a high
concventration of values in the interval between 25 and 30. Together with the
fact that the median is equal to 30, one may suspect that, as a matter of fact,
a large numeber of the values are actually equal to 30. Indeed, let us
produce a table of the response:

• table(patient$time)## ## 5 15 20 25 30 40 45 50 60 ## 1 10 15 3 30 4 5 2
1Notice that 30 of the 72 physicians marked “30” as the time they expect to
spend with the patient. This is the middle value in the range, and may just be
the default value one marks if one just needs to complete a form and do not
really place much importance to the question that was asked.
 13. REAL TIME APPLICATIONS – CASE STUDY :
UNIT – IV

• The goal of the analysis is to examine the relation between overweigh and
the Doctor’s response. The explanatory variable is a factor with two levels.
The response is numeric. A natural tool to use in order to test this hypothesis
is the t�-test, which is implemented with the function “[Link]”.

• First we plot the relation between the response and the explanatory variable
and then we apply the test:

• boxplot(time~weight,data=patient)

• [Link](time~weight,data=patient)## ## Welch Two Sample t-test ## ##

data: time by weight ## t = 2.8516, df = 67.174, p-value = 0.005774 ##
alternative hypothesis: true difference in means is not equal to 0 ## 95
percent confidence interval: ## 1.988532 11.265056 ## sample estimates:
## mean in group BMI=23 mean in group BMI=30 ## 31.36364
24.73684Nothing seems problematic in the box plot. The two distributions, as
they are reflected in the box plots, look fairly symmetric.

• When we consider the report that produced by the function “[Link]” we may
observe that the p�-value is equal to 0.005774. This p�-value is computed
in testing the null hypothesis that the expectation of the response for both
types of patients are equal against the two sided alternative. Since the p�-
value is less than 0.05 we do reject the null hypothesis.

• The estimated value of the difference between the expectation of the

response for a patient with BMI=23 and a patient with BMI=30
is 31.36364−24.73684≈6.6331.36364−24.73684≈6.63 minutes. The
confidence interval is (approximately) equal to [1.99,11.27][1.99,11.27].
Hence, it looks as if the physicians expect to spend more time with the
average weight patients.
 13. REAL TIME APPLICATIONS – CASE STUDY :
UNIT – IV

• After analyzing the effect of the explanatory variable on the expectation of

the response one may want to examine the presence, or lack thereof, of such
effect on the variance of the response. Towards that end, one may use the
function “[Link]”:

• [Link](time~weight,data=patient)## ## F test to compare two variances

## ## data: time by weight ## F = 1.0443, num df = 32, denom df = 37,
p-value = 0.8931 ## alternative hypothesis: true ratio of variances is not
equal to 1 ## 95 percent confidence interval: ## 0.5333405 2.0797269 ##
sample estimates: ## ratio of variances ## 1.044316In this test we do not
reject the null hypothesis that the two variances of the response are equal
since the p�-value is larger than 0.050.05. The sample variances are almost
equal to each other (their ratio is 1.0443161.044316), with a confidence
interval for the ration that essentially ranges between 1/2 and 2.

• The production of p�-values and confidence intervals is just one aspect in

the analysis of data. Another aspect, which typically is much more time
consuming and requires experience and healthy skepticism is the examination
of the assumptions that are used in order to produce the p�-values and the
confidence intervals. A clear violation of the assumptions may warn the
statistician that perhaps the computed nominal quantities do not represent
the actual statistical properties of the tools that were applied.

• In this case, we have noticed the high concentration of the response at the
value “30”. What is the situation when we split the sample between the two
levels of the explanatory variable? Let us apply the function “table” once
more, this time with the explanatory variable included:
 13. REAL TIME APPLICATIONS – CASE STUDY :
UNIT – IV

• table(patient$time,patient$weight)## ## BMI=23 BMI=30 ## 5 0 1 ## 15

2 8 ## 20 6 9 ## 25 1 2 ## 30 14 16 ## 40 4 0 ## 45 4 1 ## 50 2 0 ##
60 0 1Not surprisingly, there is still high concentration at that level “30”. But
one can see that only 2 of the responses of the “BMI=30” group are above
that value in comparison to a much more symmetric distribution of responses
for the other group.

• We may consider a different test, which is more robust, in order to validate

the significance of our findings. For example, we may turn the response into
a factor by setting a level for values larger or equal to “30” and a different
level for values less than “30”. The relation between the new response and
the explanatory variable can be examined with the function “[Link]”. We
first plot and then test:

• plot(factor(patient$time>=30)~weight,data=patient)

• [Link](table(patient$time>=30,patient$weight))## ## 2-sample test for

equality of proportions with continuity ## correction ## ## data:
table(patient$time >= 30, patient$weight) ## X-squared = 3.7098, df = 1,
p-value = 0.05409 ## alternative hypothesis: [Link] ## 95 percent
confidence interval: ## -0.515508798 -0.006658689 ## sample estimates:
## prop 1 prop 2 ## 0.3103448 0.5714286The mosaic plot presents the
relation between the explanatory variable and the new factor. The level
“TRUE” is associated with a value of the predicted time spent with the patient
being 30 minutes or more. The level “FALSE” is associated with a prediction
of less than 30 minutes.

• The computed p�-value is equal to 0.054090.05409, that almost reaches the

significance level of 5%. Notice that the probabilities that are being estimated
by the function are the probabilities of the level “FALSE”. Overall, one may
see the outcome of this test as supporting evidence for the conclusion of
the t�-test. However, the p�-value provided by the t�-test may over
emphasize the evidence in the data for a significant difference in the
physician attitude towards overweight patients.
 13. CONTENT BEYOND SYLLABUS : UNIT – IV

• What Is SWOT Analysis?

• SWOT (strengths, weaknesses, opportunities, and threats) analysis

is a framework used to evaluate a company's competitive
position and to develop strategic planning. SWOT analysis
assesses internal and external factors, as well as current and
future potential.

• A SWOT analysis is designed to facilitate a realistic, fact-based,

data-driven look at the strengths and weaknesses of an
organization, initiatives, or within its industry. The organization
needs to keep the analysis accurate by avoiding pre-conceived
beliefs or gray areas and instead focusing on real-life contexts.
Companies should use it as a guide and not necessarily as a
prescription.

• Components of SWOT Analysis

• Every SWOT analysis will include the following four categories.

Though the elements and discoveries within these categories will
vary from company to company, a SWOT analysis is not complete
without each of these elements:

• Strengths

• Strengths describe what an organization excels at and

what separates it from the competition: a strong brand, loyal
customer base, a strong balance sheet, unique technology, and so
on. For example, a hedge fund may have developed a proprietary
trading strategy that returns market-beating results. It must then
decide how to use those results to attract new investors.
 13. CONTENT BEYOND SYLLABUS : UNIT – IV

• Weaknesses

• Weaknesses stop an organization from performing at its optimum

level. They are areas where the business needs to improve to
remain competitive: a weak brand, higher-than-average turnover,
high levels of debt, an inadequate supply chain, or lack of capital.

• Opportunities

• Opportunities refer to favorable external factors that could give an

organization a competitive advantage. For example, if a country
cuts tariffs, a car manufacturer can export its cars into a new
market, increasing sales and market share.

• Threats

• Threats refer to factors that have the potential to harm an

organization. For example, a drought is a threat to a wheat-
producing company, as it may destroy or reduce the crop yield.
Other common threats include things like rising costs for materials,
increasing competition, tight labor supply. and so on.

• SWOT Table

• Analysts present a SWOT analysis as a square segmented into four

quadrants, each dedicated to an element of SWOT. This visual
arrangement provides a quick overview of the company’s position.
Although all the points under a particular heading may not be of
equal importance, they all should represent key insights into the
balance of opportunities and threats, advantages and
disadvantages, and so forth.
• The SWOT table is often laid out with the internal factors on the
top row and the external factors on the bottom row. In addition,
the items on the left side of the table are more positive/favorable
aspects, while the items on the right are more concerning/negative
elements.

• How to Do a SWOT Analysis

• A SWOT analysis can be broken into several steps with actionable

items before and after analyzing the four components. In general,
a SWOT analysis will involve the following steps.

• Step 1: Determine Your Objective

• A SWOT analysis can be broad, though more value will likely be

generated if the analysis is pointed directly at an objective. For
example, the objective of a SWOT analysis may focused only on
whether or not to perform a new product rollout. With an objective
in mind, a company will have guidance on what they hope to
achieve at the end of the process. In this example, the SWOT
analysis should help determine whether or not the product should
be introduced.
Step 2: Gather Resources

• Every SWOT analysis will vary, and a company may need different
data sets to support pulling together different SWOT analysis
tables. A company should begin by understanding what
information it has access to, what data limitations it faces, and
how reliable its external data sources are.
• In addition to data, a company should understand the right
combination of personnel to have involved in the analysis. Some
staff may be more connected with external forces, while various
staff within the manufacturing or sales departments may have a
better grasp of what is going on internally. Having a broad set of
perspectives is also more likely to yield diverse, value-adding
contributions.
Step 3: Compile Ideas

• For each of the four components of the SWOT analysis, the group
of people assigned to performing the analysis should begin listing
ideas within each category. Examples of questions to ask or
consider for each group are in the table below.

• Internal Factors

• What occurs within the company serves as a great source of

information for the strengths and weaknesses categories of the
SWOT analysis. Examples of internal factors include financial
and human resources, tangible and intangible (brand name)
assets, and operational efficiencies.

• Potential questions to list internal factors are:

• (Strength) What are we doing well?

• (Strength) What is our strongest asset?

• (Weakness) What are our detractors?

• (Weakness) What are our lowest-performing product lines?

External Factors

• What happens outside of the company is equally as important to

the success of a company as internal factors. External influences,
such as monetary policies, market changes, and access to
suppliers, are categories to pull from to create a list of
opportunities and weaknesses.1

• Potential questions to list external factors are:

• (Opportunity) What trends are evident in the marketplace?

• (Opportunity) What demographics are we not targeting?

• (Threat) How many competitors exist, and what is their market

share?

• (Threat) Are there new regulations that potentially could harm our
operations or products?

• Strengths
1. What is our competitive advantage?
2. What resources do we have?
3. What products are performing well?

• Weaknesses
1. Where can we improve?
2. What products are underperforming?
3. Where are we lacking resources?
• Opportunities

1. What new technology can we use?

2. Can we expand our operations?
3. What new segments can we test?

Threats
1. What regulations are changing?
2. What are competitors doing?
3. How are consumer trends changing?

• Companies may consider performing this step as a "white-

boarding" or "sticky note" session. The idea is there is no right or
wrong answer; all participants should be encouraged to share
whatever thoughts they have. These ideas can later be discarded;
in the meantime, the goal should be to come up with as many
items as possible to invoke creativity and inspiration in others.

Step 4: Refine Findings

• With the list of ideas within each category, it is now time to clean-
up the ideas. By refining the thoughts that everyone had, a
company can focus on only the best ideas or largest risks to the
company. This stage may require substantial debate among
analysis participants, including bringing in upper management to
help rank priorities.
• Step 5: Develop the Strategy

• Armed with the ranked list of strengths, weaknesses,

opportunities, and threats, it is time to convert the SWOT analysis
into a strategic plan. Members of the analysis team take the
bulleted list of items within each category and create a synthesized
plan that provides guidance on the original objective.

• For example, the company debating whether to release a new

product may have identified that it is the market leader for its
existing product and there is the opportunity to expand to new
markets. However, increased material costs, strained distribution
lines, the need for additional staff, and unpredictable
product demand may outweigh the strengths and opportunities.
The analysis team develops the strategy to revisit the decision in
six months in hopes of costs declining and market demand
becoming more transparent.
 14. ASSESSMENT SCHEDULE

• Tentative schedule for the Assessment

Name of the
[Link] Start Date End Date Portion
Assessment

1 IAT 1 17.02.2024 UNIT 1 & 2

12.02.2024

2 IAT 2 1.04.2024 06.04.2024 UNIT 3 & 4

3 Model 20.04.2024 30.04.2024 ALL 5 UNITS

83
15. PRESCRIBED TEXT BOOKS & REFERENCE BOOKS

TEXT BOOKS:
Marketing Management (Analysis, Planning, Implementation &
Control) – Philip Kotler
Fundamentals of Marketing – William J. Stanton & Others
Marketing Management – V.S. Ramaswamy and S. Namakumari
Marketing Research – Rajendra Nargundkar
Market Research – G.C. Beri
Market Research, Concepts, & Cases – Cooper Schindler
REFERENCES:
Marketing Management – Rajan Saxena
Marketing Management – S.A. Sherlekar
Service Marketing – S.M. Zha
Journals – The IUP Journal of Marketing Management, Harvard
Business Review
Research for Marketing Decisions by Paul Green, Donald, Tull
Business Statistics, A First Course, David M Levine at al, Pearson
Publication
 16. MINI PROJECT SUGGESTION

Use any of the marketing research techniques and perform the

analysis of the statements listed below and conclude with proof as
per the statistics by using any statistical tools.

(i) Analysis of the Effects of Social Media Marketing on

Consumer Behavior

(ii) Do Consumer Purchase Decisions Affect Brand

Experience?

(iii) How Sales Performance Is Affected by Customer

Satisfaction

(iv) The future of e-commerce and its relationship to digital

marketing

(v) Which digital marketing approach is ideal for startups?

85
 Thank you

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