8/1/18

Variables & Hypotheses

• When research problem is clear and at

least broad research questions are
formulated…. the next step is to –
– Determine the Relevant Variables to the
Situation
– In this step, the researcher and decision
maker jointly determine the specific variables
pertinent to each defined problem or question
that needs to be answered.

1
 8/1/18

• The focus is on identifying the different

independent and dependent variables.
• Determination must be made as to the
types of information (i.e., facts, estimates,
predictions, relationships) and specific
constructs that are relevant to the
decision problem.

Constructs and Concepts

• Constructs:
– Abstract idea inferred from specific instances that are
thought to be related
– Not directly observable or measurable
– May be complex
• Typical marketing constructs are brand loyalty,
satisfaction, preference, awareness, knowledge.
• Research objectives typically call for the
measurement of constructs.

2
 8/1/18

• A construct is based on ‘concepts’, or

can be thought of as a conceptual model
that has measurable aspects.
• Concepts are components of construct
and are concrete, and are, therefore,
measurable.

Example:
Construct Concepts
Knowledge
Job competence Skills
Attitude
Memory
Mental ability Analytical ability
Logical power
Vocabulary
Language skill Syntax
Spelling

3
 8/1/18

• We design hypotheses using concepts.

• We devise measurement concepts by which to
test these hypothetical statements.
• We gather data using these measurement
concepts.
• The success of research hinges on –
– how clearly we conceptualize and
– how well others understand the concepts we use

• The challenge is to develop concepts that others will

clearly understand. We might, for example, ask
participants for an estimate of their family’s total income.
This may seem to be a simple, unambiguous concept,
but we will receive varying and confusing answers
unless we restrict or narrow the concept by specifying:
– Time period, such as weekly, monthly, or annually.
– Before or after income taxes.
– For head of family only or for all family members.
– For salary and wages only or also for dividends,
interest, and capital gains.
– Income in kind, such as free rent, employee
discounts, or food stamps.

4
 8/1/18

Operational definition of a concept

• Operational definition: specifies precisely
how a concept will be measured.
• For example, prosperity of an individual is
a concept.
– The researcher may define ‘income’ as a
variable measuring prosperity.
– Further, its operational definition could be
‘Annual Income’.

Variables
• When we operationalize a concept, we are
creating variables!
• Definition: Any event, situation, behavior,
or individual characteristics that varies
(meaning it must have at least two values)
• In a study, data are generally collected for
relevant variables.

5
 8/1/18

Classification of variables
• Independent variable (IV)
• Dependent variable (DV)
• Moderating variable (MV)
• intervening variable (IVV)
• Extraneous variable (EV)

• The switch to commission from a salary compensation

system (IV) will lead to increased sales productivity (DV)
per worker.
• The switch to commission from a salary compensation
system (IV) will lead to increased sales productivity (DV)
per worker, especially among young workers (MV).
• With new-customers (EV-control), a switch to
commission from a salary compensation system (IV) will
lead to increased sales productivity (DV) per worker,
especially among young workers (MV).

6
 8/1/18

• The switch to a commission compensation system (IV)

will lead to increased sales productivity (DV) by
increasing overall compensation (IVV).

• A promotion campaign (IV) will increase savings activity

(DV), especially when free prizes are offered (MV), but
chiefly among smaller savers (EV-control). The result
comes from enhancing motivation (IVV).

Hypothesis are used to state the

relationship between two variables and
may be stated as
• Null hypotheses (no relationship between two
variables).

• Nondirectional hypotheses (we don’t know or

won’t speculate about the direction of the
relationship between two variables).

• Directional hypotheses. We state the direction of

the relationship between two variables.

7
 8/1/18

Relationships specify:
• How the value of one variable changes in
relation to another.
• May be either positive, negative, or the two
variables may not have any relationship to one
another.
• Are not necessarily correlations. The type of
relationship or association among variables
is determined by the level of measurement of
each of the two variables.

Examples of relationship type:

Negative Positive None
1 5 1 1 1 3
2 4 2 2 2 1
3 3 3 3 3 5
4 2 4 4 4 4
5 1 5 5 5 2

8
 8/1/18

Examples of hypothesis type:

• Null: There will be no difference in scores on
Hudson’s self-esteem scale between men and
women.

• Directional: Women will have higher scores than

men on Hudson’s self-esteem scale.

• Nondirectional: There will be a difference by

gender in Hudson’s self-esteem scale scores.

Type of hypotheses
• Based on how we assign variables to a
case/situation of interest –
– Descriptive
– Relational and Causal

A case is defined in this sense as the entity of

the thing the hypothesis talks about.

9
 8/1/18

Descriptive hypotheses
• State the existence, size, form, or
distribution of some variable
– Brand Manager Mr. Nader (C) has a higher
than average achievement motivation (V).
Or if the hypothesis is based on more than one
case it can be generalized as
– Brand Managers in Company Z (Cs) have a
higher than average achievement motivation
(V).

Relational Hypotheses
• Describe a relationship between two (or
more) variables with respect to some
case.
– Foreign (V) products are perceived by BD
consumers (C) to be of better quality (V) than
domestic products.

10
 8/1/18

Relational Hypotheses
• Depending on the nature of relationship
– Unspecified relationship/Correlational
relationship: variables occur together in some
specified manner without implying that one
causes the other.
• Young women (under 35 years of age) purchases
fewer unit of products than women who are 35 or
older.
• Number of suits sold varies with the level of
business cycle.

Relational Hypotheses
• Depending on the nature of relationship
– Predictable relationship/Causal or
explanatory relationship: indicates cause and
effect relationship between two variables (IV-
DV relationship)
• An increase in family income (IV) leads to an
increase in the percentage of savings (DV).
• Loyalty to a particular grocery store (IV) increases
the probability of purchasing the private brands
(DV) sponsored by the store.

11
 8/1/18

Identify the type of hypothesis …

• The average salary package offered to the students of
two management institutes are same.
• Changes in sales turnover is caused by changes in
advertising expenses.
• Average life of light bulbs manufactured by a factory is
2500 hrs.
• Academic background (B.A./B.Sc.) guides the area of
specialization opted by MBA students.
• The number of suits sold varies directly with the level of
business cycle.

Role of the hypotheses

It -
– Guides the direction of the study
– Identifies facts that are relevant and those
that are not
– Suggests which form of research design is
likely to be most appropriate
– Provides a framework for organizing the
conclusions

12
 8/1/18

A strong hypothesis
Is
– Adequate for its purpose
– Testable
– Better than its rivals

Thank you!

13