Slides 5 - Samling and Sample Size

Slide 7.
Selecting Samples and Sample Size
Saunders, Lewis and Thornhill, Research Methods for Business Students, 5th Edition, Mark Saunders, Philip Lewis and Adrian Thornhill 2009
Slide 7.2
The Sampling Design Process
Define the
Population
Determine the Sampling
Frame
Select Sampling Technique(s)
Determine the Sample Size
Execute the Sampling Process
Slide 7.3
Selecting samples
Figure 7.1 Population, sample and individual cases

Slide 7.4
Basic Concepts in Sampling
Copyright 2010 Pearson Education, Inc.
12-4
publishing
as Prentice
Hall
Saunders, Lewis and Thornhill, Research
Methods
for Business
Students, 5th Edition, Mark Saunders, Philip Lewis and Adrian Thornhill 2009
Slide 7.5
The need to sample - Sampling- a valid alternative to a

census when
A survey of the entire population is impracticable

Budget constraints restrict data collection
Time constraints restrict data collection
Results from data collection are needed quickly
Imagine that in a lawsuit the defendant, a utility firm, overbilled customers.

The plaintiffs determined that the average overbilling amounted to $49.50
per customer. The judge learned that the amount was based on a sample
and did not want to rely on an analysis of a sample. He insisted upon a
three-month process of analyzing each bill. The exact amount of
overbilling was $49.48!!! There are many actual situations similar to this.
They are MORE accurate than a census (when the population is large). The
large field staff needed to collect data from a large census make many
errors.
Slide 7.6
Define the Target Population

Important qualitative factors in determining the sample size are:
the importance of the decision

the nature of the research
the number of variables
the nature of the analysis
sample sizes used in similar studies
incidence rates
completion rates
resource constraints
Slide 7.7
Sample Sizes Used in Marketing

Research Studies
Slide 7.8
Overview of sampling techniques
Figure 7.2 Sampling techniques

Slide 7.9
Convenience Sampling
Convenience sampling attempts to obtain a sample of
convenient elements. Often, respondents are selected
because they happen to be in the right place at the right
time.
Use of students, and members of social organizations
Mall intercept interviews without qualifying the

respondents
Department stores using charge account lists
People on the street interviews
Slide 7.10
Judgmental Sampling
Judgmental sampling is a form of convenience
sampling in which the population elements are
selected based on the judgment of the researcher.
Test markets
Purchase engineers selected in industrial marketing

research
Bellwether precincts selected in voting behavior

research
Expert witnesses used in court
Slide 7.11
Judgment - Purposive Sample
Extreme case or deviant sampling

Focuses on unusual or special cases on the basis that the data
collected about these unusual or extreme outcomes will enable
you to learn the most and to answer your research question's and
to meet your objective most effectively. This is often based on the
premises that findings from extreme cases will be relevant in
understanding or explaining more typical cases
Heterogeneous or maximum variation sampling
Enables you to collect data to describe and explain the key themes
that can be observed. Although this might appear a contradiction,
as a small sample may contain cases that are completely different
In direct contrast to heterogeneous sampling, homogeneous sampling
focuses on one particular sub-group in which all the sample members
are similar, this enables you to study the group in great depth
Slide 7.12
Quota Sampling
Quota sampling may be viewed as two-stage restricted judgmental
sampling.
The first stage consists of developing control categories, or

quotas, of population elements.
In the second stage, sample elements are selected based on
convenience or judgment.
Variable
Sex
Male
Female
Control Population
composition
composition
Percentage
Percentage
Sample
48
52
____
100
480
520
____
1000
48
52
____
100
Number
Slide 7.13
Snowball Sampling
In snowball sampling, an initial group of respondents is
selected, usually at random.
After being interviewed, these respondents are asked

to identify others who belong to the target population of
interest.
Subsequent respondents are selected based on the

referrals.
Slide 7.14
Simple Random Sampling
Each element in the population has a known and

equal probability of selection.
Each possible sample of a given size (n) has a known

and equal probability of being the sample actually
selected.
This implies that every element is selected

independently of every other element.
Slide 7.15
Systematic Sampling
The sample is chosen by selecting a random starting point and

then picking every i-th element in succession from the sampling
frame.
The sampling interval, i, is determined by dividing the

population size N by the sample size n and rounding to the
nearest integer.
When the ordering of the elements is related to the

characteristic of interest, systematic sampling increases the
representativeness of the sample.
Slide 7.16
Systematic Sampling
If the ordering of the elements produces a cyclical pattern,

systematic sampling may decrease the representativeness of
the sample.
For example, there are 100,000 elements in the population
and a sample of 1,000 is desired. In this case the sampling
interval, i, is 100. A random number between 1 and 100 is
selected. If, for example, this number is 23, the sample
consists of elements 23, 123, 223, 323, 423, 523, and so on.
Slide 7.17
Stratified Sampling
A two-step process in which the population is partitioned into

subpopulations, or strata.
The strata should be mutually exclusive and collectively

exhaustive in that every population element should be
assigned to one and only one stratum and no population
elements should be omitted.
Next, elements are selected from each stratum by a random

procedure, usually SRS.
A major objective of stratified sampling is to increase

precision without increasing cost.
Slide 7.18
Stratified Sampling
The elements within a stratum should be as

homogeneous as possible, but the elements in different
strata should be as heterogeneous as possible.
The stratification variables should also be closely

related to the characteristic of interest.
Finally, the variables should decrease the cost of the

stratification process by being easy to measure and
apply.
Slide 7.19
Stratified Sampling
Slide 7.20
Stratified Sampling
In proportionate stratified sampling, the size of the sample

drawn from each stratum is proportionate to the relative
size of that stratum in the total population.
In disproportionate stratified sampling, the size of the

sample from each stratum is proportionate to the relative
size of that stratum and to the standard deviation of the
distribution of the characteristic of interest among all the
elements in that stratum.
Slide 7.21
Cluster Sampling
The target population is first divided into mutually

exclusive and collectively exhaustive subpopulations, or
clusters.
Then a random sample of clusters is selected, based on a

probability sampling technique such as SRS.
For each selected cluster, either all the elements are

included in the sample (one-stage) or a sample of
elements is drawn probabilistically (two-stage).
Slide 7.22
Cluster Sampling
Elements within a cluster should be as heterogeneous

as possible, but clusters themselves should be as
homogeneous as possible. Ideally, each cluster should
be a small-scale representation of the population.
In probability proportionate to size sampling, the clusters

are sampled with probability proportional to size. In the
second stage, the probability of selecting a sampling
unit in a selected cluster varies inversely with the size of
the cluster.
Slide 7.23
Strengths and Weaknesses of

Basic Sampling Techniques
Technique
Strengths
Weaknesses
NonprobabilitySampling
Conveniencesampling
Leastexpensive,least
timeconsuming,most
convenient
Lowcost,convenient,
nottimeconsuming
Samplecanbecontrolled
forcertaincharacteristics
Canestimaterare
characteristics
Selectionbias,samplenot
representative,notrecommendedfor
descriptiveorcausalresearch
Doesnotallowgeneralization,
subjective
Selectionbias,noassuranceof
representativeness
Timeconsuming
Easilyunderstood,
results projectable
Difficulttoconstructsampling
frame,expensive, lowerprecision,
noassuranceof representativeness
Candecrease representativeness
Judgmentalsampling
Quotasampling
Snowballsampling
Probabilitysampling
Simplerandomsampling
(SRS)
Systematicsampling
Stratifiedsampling
Clustersampling
Canincrease
representativeness,
easiertoimplementthan
SRS,samplingframenot
necessary
Includeallimportant
subpopulations,
precision
Easytoimplement,cost
effective
Difficulttoselectrelevant
stratificationvariables,notfeasibleto
stratifyonmanyvariables,expensive
Imprecise,difficulttocomputeand
interpretresults
Slide 7.24
Nonprobability Sampling
May not be representative but they are still used very often.
Why?
1. Decision makers want fast, relatively inexpensive
answers nonprobability samples are faster and less
costly than probability samples.and.
2. Decision makers can make a decision based upon what
100 or 200 or 300 people saythey dont feel they need a
probability sample.
Slide 7.25
https://www.surveysampling.com
Slide 7.26
A Classification of Internet Sampling

Internet Sampling
Online Intercept
Sampling
Recruited Online
Sampling
NonrandomRandom
Recruited
Panels
Panel
Opt-in
Panels
Other Techniques
Nonpanel
Opt-in
List
Rentals
Slide 7.27
Putting It All Together
MR What level of accuracy do you want?

MM I dont have a clue.
MR National opinion polls use 3.5%.
size of a probability
MM Sounds goodThe
to me.
sample
depends
the of 1,200.
MR Okay, that means
we
need aon
sample
clients
desired accuracy
MM Gee Whiz. That
small?
sample
error)
MR Yup, and at a(acceptable
cost of $20
per completion,
it will be
$24,000.
balanced against the cost of
MM Holy Cow! That
data much?
collection for that
MR I could do 500
for $10,000,
and that would be
sample
size.
4.4% accurate, or 300 for $6,000 at 5.7%.
MM 500 sounds good to me.
13-27
publishing
as Prentice
Hall
Methods
for Business
Slide 7.28
A Picture Says 1,000 Words
Probability sample accuracy (error) can be calculated with a

simple formula, and expressed as a % number.
Slide 7.29
Sample Size Formula
Fortunately, statisticians have given us a

formula which is based upon these relationships.
The formula requires that we:
Specify
the amount of confidence we wish

Estimate the variance in the population
Specify the amount of desired accuracy we
want
When we specify the above, the formula tells

us what sample we need to usen
Slide 7.30
Sample Size Formula
Standard sample size formula for estimating

a percentage:
Slide 7.31
Practical Considerations in Sample

Size Determination
How to estimate variability (p times q) in the

population
Expect the worst cast (p=50; q=50)
Estimate variability: Previous studies?
Conduct a pilot study?
Slide 7.32

Size Determination
How to determine the amount of desired

sample error
Researchers should work with managers to
make this decision. How much error is the
manager willing to tolerate?
Convention is + or 5%.
The more important the decision, the
more (smaller number) the sample error.
Slide 7.33

Size Determination
How to decide on the level of confidence

desired
Researchers should work with managers to
make this decision. The more confidence,
the larger the sample size.
Convention is 95% (z=1.96)
The more important the decision, the
more likely the manager will want more
confidence. 99% confidence, z=2.58.
Slide 7.34
Definitions and Symbols
Precision level: When estimating a population parameter by

using a sample statistic, the precision level is the desired size
of the estimating interval. This is the maximum permissible
difference between the sample statistic and the population
parameter.
Confidence interval: The confidence interval is the range into

which the true population parameter will fall, assuming a
given level of confidence.
Confidence level: The confidence level is the probability that a

confidence interval will include the population parameter.
Slide 7.35
95% Confidence Interval
0.47
5
_
XL
0.47
5
_
X
_
XU
Slide 7.36
Sample Size Determination for

Means and Proportions
Slide 7.37
Example: Estimating a Percentage in the Population
What is the required sample size?

Five years ago, a survey showed that 42% of
consumers were aware of the companys
brand (Consumers were either aware or
not aware.)
After an intense ad campaign, management
wants to conduct another survey and they
want to be 95% confident that the survey
estimate will be within 5% of the true
percentage of aware consumers in the
population.
What is n?
Slide 7.38
Estimating a Percentage: What is n?
Z=1.96 (95% confidence)

p=42
q=100-p=58
e=5
What is n?
Slide 7.39
Estimating a Percentage: What is n?
N=374
What does this mean?
It means that if we use a sample size of 374,

after the survey, we can say the following of the
results: (assume results show that 55% are aware)
Our most likely estimate of the percentage of

consumers that are aware of our brand name is
55%. In addition, we are 95% confident that the
true percentage of aware customers in the
population falls between 50% and 60%.
Slide 7.40
Estimating a Mean
Estimating a mean requires a different
formula (See MRI 13.1, p. 386.)
Z is determined the same way (1.96 or 2.58)
E is expressed in terms of the units we are

estimating (i.e., if we are measuring
attitudes on a 1-7 scale, we may want error
to be no more than .5 scale units
S is a little more difficult to estimate
13-40
Slide 7.41
Estimating s
Since we are estimating a mean, we can assume that

our data are either interval or ratio. When we have
interval or ratio data, the standard deviation, s, may
be used as a measure of variance.
Use standard deviation from a previous study on the

target population.
Conduct a pilot study of a few members of the target
population and calculate s.
Estimate the range the value you are estimating can
take on (minimum and maximum value) and divide
the range by 6.
13-41
Slide 7.42
Estimating s
How to estimate s
Why divide the range by 6?
The
range covers the entire distribution and

3 (or 6) standard deviations cover 99.9% of the
area under the normal curve. Since we are
estimating one standard deviation, we divide
the range by 6.
13-42
publishing
as Prentice
Hall
Methods
for Business
Slide 7.43
Example: Estimating the Mean of a Population

What
is the required sample size?
Management wants to know customers

level of satisfaction with their service.
They propose conducting a survey and
asking for satisfaction on a scale from 1 to
10. (since there are 10 possible answers,
the range=10).
Slide 7.44
Example: Estimating the Mean of a Population

What
is the required sample size?
Management wants to be 99% confident in

the results and they do not want the
allowed error to be more than .5 scale
points.
What is n?
Slide 7.45
Estimating a Mean: What is n?
S=10/6 or 1.7
Z=2.58 (99% confidence)
e=.5 scale points
What is n?
Slide 7.46
Estimating a Percentage:
What is n?
N=77
What does this mean?
After the survey, management may make the

following statement: (assume satisfaction mean is
7.3)
Our most likely estimate of the level of consumer

satisfaction is 7.3 on a 10-point scale. In addition,
we are 99% confident that the true level of
satisfaction in our consumer population falls
between 6.8 and 7.8 on a 10-point scale.
Slide 7.47
Other Methods of Sample Size Determination
Conventional sample size specification:

Conventional approach follows some
convention: or number believed somehow to
be the right sample size.
Using conventional sample size can result in
a sample that may be too large or too small.
Conventional sample sizes ignore the special
circumstances of the survey at hand.
Slide 7.48
Other Methods of Sample Size Determination
Statistical analysis requirements of sample size

specification:
Sometimes the researchers desire to use particular
statistical technique influences sample size.
Cost basis of sample size specification:
All you can afford method
Instead of the value of the information to be gained
from the survey being primary consideration in the
sample size, the sample size is determined by
budget factors that usually ignore the value of the
surveys results to management.
Slide 7.49
Adjusting the Statistically Determined Sample Size

Incidence rate refers to the rate of occurrence or the
percentage, of persons eligible to participate in the study.
In general, if there are c qualifying factors with an incidence
of Q1, Q2, Q3, ...QC, each expressed as a proportion:
Incidence rate
= Q1 x Q2 x Q3....x QC
Initial sample size
=
Final sample size
.
Incidence rate x Completion rate
Slide 7.50
Cumulative questionnaires returned by Internet and

post
Slide 7.51
Improving Response Rates

Methods of Improving
Response Rates
Reducing
Refusals
Reducing
Not-at-Homes
Prior
Motivating Incentives Questionnair Follow-Up Other
e Design
Facilitators
Notification Respondents
and
Administratio
n
Callbacks
Slide 7.52
Arbitron Responds to Low Response Rates

Arbitron, a major marketing research supplier, was trying to improve response
rates in order to get more meaningful results from its surveys. Arbitron created
a special cross-functional team of employees to work on the response rate
problem. Their method was named the breakthrough method, and the whole
Arbitron system concerning the response rates was put in question and
changed. The team suggested six major strategies for improving response
rates:
1.
2.
3.
4.
5.
6.
Maximize the effectiveness of placement/follow-up calls.

Make materials more appealing and easy to complete.
Increase Arbitron name awareness.
Improve survey participant rewards.
Optimize the arrival of respondent materials.
Increase usability of returned diaries.
Eighty initiatives were launched to implement these six strategies. As a result,

response rates improved significantly. However, in spite of those encouraging
results, people at Arbitron remain very cautious. They know that they are not
done yet and that it is an everyday fight to keep those response rates high.
Slide 7.53

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Slide 7.

Selecting Samples and Sample Size

The Sampling Design Process

Figure 7.1 Population, sample and individual cases

Basic Concepts in Sampling

Copyright 2010 Pearson Education, Inc.

The need to sample - Sampling- a valid alternative to a

A survey of the entire population is impracticable

Imagine that in a lawsuit the defendant, a utility firm, overbilled customers.

Define the Target Population

the importance of the decision

Sample Sizes Used in Marketing

Overview of sampling techniques

Figure 7.2 Sampling techniques

Use of students, and members of social organizations

Mall intercept interviews without qualifying the

Department stores using charge account lists

People on the street interviews

Purchase engineers selected in industrial marketing

Bellwether precincts selected in voting behavior

Expert witnesses used in court

Judgment - Purposive Sample

Extreme case or deviant sampling

The first stage consists of developing control categories, or

After being interviewed, these respondents are asked

Subsequent respondents are selected based on the

Simple Random Sampling

Each element in the population has a known and

Each possible sample of a given size (n) has a known

This implies that every element is selected

The sample is chosen by selecting a random starting point and

The sampling interval, i, is determined by dividing the

When the ordering of the elements is related to the

If the ordering of the elements produces a cyclical pattern,

A two-step process in which the population is partitioned into

The strata should be mutually exclusive and collectively

Next, elements are selected from each stratum by a random

A major objective of stratified sampling is to increase

The elements within a stratum should be as

The stratification variables should also be closely

Finally, the variables should decrease the cost of the

In proportionate stratified sampling, the size of the sample

In disproportionate stratified sampling, the size of the

The target population is first divided into mutually

Then a random sample of clusters is selected, based on a

For each selected cluster, either all the elements are

Elements within a cluster should be as heterogeneous

In probability proportionate to size sampling, the clusters

Strengths and Weaknesses of

A Classification of Internet Sampling

Putting It All Together

MR What level of accuracy do you want?

Copyright 2010 Pearson Education, Inc.

A Picture Says 1,000 Words

Probability sample accuracy (error) can be calculated with a

Sample Size Formula

Fortunately, statisticians have given us a

the amount of confidence we wish

When we specify the above, the formula tells

Sample Size Formula

Standard sample size formula for estimating

Practical Considerations in Sample