The purpose of this lab is to introduce you to the art of making strategic inferences about a business' market area, based on telephone surveys made to a simple random sample of household telephone numbers in the market area. It is common in such market area analyses to draw inferences from cross-tabs that might not be statistically impressive. That is, these inferences would not be accepted at the confidence levels normally used to make decisions in social science research. In the rough-and-tumble of business decision-making, however, businesses would suffer more from a Type II error (failing to detect a true relationship in the data) than from a Type I error (thinking there's a real relationship among variables when there really isn't). So, your goal is to pick out potential relationships that might be useful to the editor of News-X of Oroville, California.
OROVILLE SURVEY CROSSTABS
-------------------------------------------------------------------------
Table 1 NEWS-X NON-NEWS-X TOTAL
n=103 n=138 n=241
# % # % # %
Mercury-Register 67 65.0 70 50.7 137 56.8
Enterprise-Record 21 20.4 28 20.3 49 20.3
Dollar Saver 41 39.8 5 3.6 46 19.1
Chico News & Review 44 42.7 28 20.3 72 29.9
Wheels and Deals 61 59.2 28 20.3 89 36.9
Oroville Shopping News 39 37.9 11 8.0 50 20.7
Senior Lifestyle 23 22.3 17 12.3 40 16.6
Sacramento Bee 3 2.9 2 1.4 5 2.1
-------------------------------------------------------------------------
Table 2 NEWS-X NON-NEWS-X TOTAL
n=103 n=138 n=241
# % # % # %
M-R subscribers 53 51.5 54 39.1 107 44.4
M-R non-subscribers 52 50.5 78 56.5 130 53.9
-------------------------------------------------------------------------
Table 3 NEWS-X NON-NEWS-X TOTAL
n=98 n=134 n=232
# % # % # %
Gets cable TV 47 48.0 81 60.4 128 55.2
No cable TV 51 52.0 53 39.6 104 44.8
-------------------------------------------------------------------------
Table 4 NEWS-X NON-NEWS-X TOTAL
n=105 n=137 n=242
# % # % # %
Has NOT bought or 66 62.9 109 79.6 175 72.3
sold from NEWS-X
Bought from NEWS-X ad 17 16.2 11 8.0 28 11.6
Sold with NEWS-X ad 22 21.0 17 12.4 39 16.1
-------------------------------------------------------------------------
Table 5 NEWS-X NON-NEWS-X TOTAL
n=280 n=325 n=605
# % # % # %
Downtown Oroville 60 21.4 74 22.8 134 22.1
K-Mart Shopping Center 60 21.4 58 17.8 118 19.5
Lucky's Shopping Center 49 17.5 56 17.2 105 17.4
Village Shopping Center 13 4.6 13 4.0 26 4.3
Chico 63 22.5 76 23.4 139 23.0
Gridley 3 1.1 12 3.7 15 2.5
Marysville-Yuba City 25 8.9 27 8.3 52 8.6
Sacramento 0 .0 1 .3 1 .2
WalMart 6 2.1 7 2.2 13 2.1
Beale AFB 0 .0 1 .3 1 .2
Cost-Co 1 .4 0 .0 1 .2
-------------------------------------------------------------------------
Table 6 NEWS-X NON-NEWS-X TOTAL
n=136 n=165 n=301
# % # % # %
Raley's 35 25.7 60 36.4 95 31.6
Albertson's 46 33.8 42 25.5 88 29.2
Lucky's 28 20.6 32 19.4 60 19.9
Food 4 Less 20 14.7 24 14.5 44 14.6
Fred Meyer 1 .7 2 1.2 3 1.0
Foot Outlet 0 .0 1 .6 1 .3
Cost-Co 2 1.5 3 1.8 5 1.7
Safeway 1 .7 1 .6 2 .7
Collins and Denny 3 2.2 0 .0 3 1.0
-------------------------------------------------------------------------
Table 7 NEWS-X NON-NEWS-X TOTAL
n=103 n=138 n=241
# % # % # %
Children < 18 18 17.5 35 25.4 53 22.0
No children < 18 85 82.5 103 74.6 188 78.0
-------------------------------------------------------------------------
Table 8 NEWS-X NON-NEWS-X TOTAL
n=105 n=136 n=241
# % # % # %
Does NOT plan to buy 91 86.7 116 85.3 207 85.9
a car or truck
Plans to buy a NEW 6 5.7 8 5.9 14 5.8
car or truck
Plans to buy a USED 8 7.6 12 8.8 20 8.3
car or truck
-------------------------------------------------------------------------
Table 9 NEWS-X NON-NEWS-X TOTAL
n=102 n=132 n=234
# % # % # %
Home owners 96 94.1 116 87.9 212 90.6
Renters 6 5.9 16 12.1 22 9.4
-------------------------------------------------------------------------
Table 10 NEWS-X NON-NEWS-X TOTAL
n=103 n=133 n=236
# % # % # %
Under 18 years old 0 .0 4 3.0 4 1.7
18-21 1 1.0 8 6.0 9 3.8
22-29 3 2.9 8 6.0 11 4.7
30-44 15 14.6 30 22.6 45 19.1
45-54 22 21.4 13 9.8 35 14.8
55-64 22 21.4 27 20.3 49 20.8
65 or older 40 38.8 43 32.3 83 35.2
-------------------------------------------------------------------------
Table 11 NEWS-X NON-NEWS-X TOTAL
n=103 n=133 n=236
# % # % # %
Female 60 58.3 76 57.1 136 57.6
Male 43 41.7 57 42.9 100 42.4
So, write up an informative little report, characterizing the readership of News-X. The editor wants to know who the readers and non-readers are, what their purchasing and selling habits and plans are, and how they learn about purchasing opportunities. S/he also specifically wants to know how the News-X compares to the other information channels available in the Oroville area, with an eye to pitching any superiorities that turn up to potential advertisers in the grocery, automotive, and home supplies markets.
The editor is also specifically curious about the size of the new and used car markets in the Oroville area, hoping to attract more car dealerships as advertisers. To get at this, you could assume that the proportions of survey respondents making plans to buy a car is about the same as for the number of Oroville households as given in the Census (since this was a simple random sample, after all). Multiply the proportion of respondents with new car-buying plans and with used-car buying plans by the total number of Oroville area households, in order to figure out how many Oroville households are in the market for cars in the next year. Now, the people who said they'd buy a new car expected to pay, on average, $17,550; those who planned to buy a used car expected to spend $6,750 on average. Multiply the number of probable Oroville-area households likely to buy new cars by this average price and do the same for the used cars. What is the total potential market for automobiles in the area?