Experiments and test markets

Experiments and Test Markets

Classification of Research Design on the basis of Researcher’s control on variable:1) Ex-post facto study2) Experiment: The researcher manipulates

some variable and observes whether the hypothesized dependent variable is affected or not

The experiments are used to find the causal relationship between the IV and DV

Advantage:Ability to manipulate IV (The researcher is having full control on variable)

Control of extraneous variables

Replication possible

Field experiments possible

Disadvantages:Results can not be generalized for other populations

Experiments are conducted in laboratory environment, so the results may not be the same for natural environment

Experiment can be conducted for present and future, not for past

Ethical limitations

Conducting an Experiment

Specify treatment levels

Control environment

Choose experimental design

Select and assign participants

Pilot-test, revise, and test

Collect data

Analyze data

Specify treatment levels

Experimentation in Research Process

Experimental Group: Composed of subjects or participants who receive experimental treatment

Control Group: Composed of subjects or participants who do not receive experimental treatment or who are not exposed to independent variable(s)

Blind Experiment: when subjects do not know if they are receiving an experimental treatment

Double Blind Experiment: When experimenters do not know if they are giving the treatment to the experimental group or to the control group

Validity in Experimentation

ExternalInternal

Validity in ExperimentationInternal Validity: do the conclusions we

draw about an experimental relationship truly imply cause? That is whether our assumption about IV and DV was correct or not? Or other variables cause DV to occur?

External Validity: deals with ability to generalize the study to persons or settings or times

Threats to Internal Validity

Threats

Maturation History

Testing

Instrumentation

Selection

Statisticalregression

Experimentalmortality

Additional Threats to Internal Validity

Diffusion/imitation of treatment

Diffusion/imitation of treatment

Compensatory equalization

Compensatory equalization

Compensatory rivalryCompensatory rivalry

Resentful demoralization of

disadvantaged

Resentful demoralization of

disadvantaged

Local historyLocal history

Threats to External Validity

Reactivity of testing on X

Interaction of selection and X

Other reactive factors

Experimental Research Designs

Pre-experiments

True experiments

Field experiments

Pre-experimental DesignsAfter – Only Study

X = treatment or manipulation of IVO = Observation or measurement of DV(post test)

X O

Pre-experimental Designs(conti..)

One Group Pretest – Post test Design

O1 = Pre testX = Manipulation or treatmentO2 = Post testEffect of treatment=O2 – O1

O1 X O2

Pre-experimental Designs(conti..)

Static Group ComparisonComparison of experimental group and control group

O1 = post test on experimental group\O2 = post test on control groupHere participants are not randomly assigned

X O1

---------- ----------- O2

True Experimental DesignPretest-Posttest Control Group Design

“ R” indicates that, the group members are randomly assigned to the group

Effect of experimental variable or treatment,E= (O1 – O2) – (O4 – O3)

Experimental Group R O1 X O2

Control Group R O3 O4

True Experimental Design(conti..)

Posttest – only Control Group Design

E = O2 – O1

Field Experiments

Nonequivalent Control Group Design

Assignment of participant is not random

Self selection is also allowed

O1 X O2

O3 O4

Field Experiments(conti..)

Separate Sample Pretest-Posttest Design

Pretesting on one group and post testing on other group

R O1 (X) R X O2

Field Experiments(conti..)

Group Time Series Design:It introduces repeated observations before and after the treatment

Ex: If the federal government were to suddenly begin price controls, we could still study the effects of this action later if we had regularly collected records for the period before and after the advent of price control

Test Marketing

• A Test Market is a controlled experiment conducted in a carefully chosen marketplace (ex: web site, store, town or other geographic location) to measure marketplace response and predict sales or profitability of a product

Test Market Selection

Control of distributionControl of

distribution

CriteriaCriteria

RepresentativeRepresentative

Multiple locationsMultiple locations

Types of Test Markets

Standard Standard

ControlledControlled

ElectronicElectronic

SimulatedSimulated

VirtualVirtual

Web-enabledWeb-enabled

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Experiments and test markets

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