Razor Products in the Market - Case Study Example

Case Study Analysis Report Name Number Course Tutor Date Executive summary Survey data usually provide great insight about the underlying characteristics of the population of interest. In this case study, the prices of razor products available in the market were analyzed with the aim of determining how some factors influence the pricing of razor products. Both descriptive and inferential statistics were used in describing the survey data. The results of the analysis indicate that the prices of female razor products are generally higher compared to that of the male razor products. Razor products made in France were on average the most expensive compared to those made in USA and other countries. The 5-blade razor products sampled were also established to be more expensive than the 3-blade and twin blade razor products. Table of Contents Executive summary 2 Introduction 4 Business problem 4 Statistical problem 5 Analysis 7 Male and female products 7 Number of cartridges blades 9 Country of manufacture 12 Inferential statistics 15 Male and female products 15 Twin blade, 3-blade and 5-blade cartridges 15 Country of manufacture 16 Conclusion 17 Implications 18 Reference List 19 Introduction Market research is an essential process that should be undertaken by business organizations in their respective target market. Ideally, products available in different markets should meet the customer expectations and requirement in each of the markets. The ability of firms to provide products and services that adequately meet the customer expectations, taste and preference greatly determines the success of the respective products and services in the market. Notably, market surveys enable organizations to study the consumer behavior in target markets. Consequently, business organizations through such surveys are able to identify market requirements and factors that drive consumer purchasing behavior (Corder, 2010). Business problem In this case study, market characteristics related to razors in the market will be evaluated to help guide the organization in decision making regarding the new line of razor products it intends to launch in the Asian market. The main characteristic of interest include the price of the different razor blades in the market based on the targeted gender, number of blades in a packet, number of cartridge blades, and place of manufacture. The aim is to determine how the price of razor blades differs depending on the underlying market characteristics. How these market characteristics influences market prices of razors will eventually enable the organization to make informed decisions about its new line of razors. Notably, the prices for female razor products may be either higher or lower compared to that of the male razor products. Similarly, razors manufactured in the U.S. may be priced higher or lower compared to those produced in Europe and other countries across the world. Therefore, the determination of how these factors affect the pricing of razors in the market will be insightful to the firm’s management when setting the market price of its new line of razor products. This will ensure that the firm’s new products are competitively priced in comparison to its competitors in the market. Furthermore, a better understanding of the market requirements and factors that influence pricing of razors in the market may give the firm a competitive advantage, which tends to promote the sales performance of products and services available in the market. Statistical problem In market research and subsequent data analysis, there are various statistical techniques that can be used to study characteristics of the sample data and evaluate hypotheses made about the underlying population of interest. However, it is important to apply the appropriate statistical technique to achieve valid and reliable results. Some of the commonly used statistical techniques include descriptive statistics such as mean and variance. Similarly, graphical techniques such as histograms, bar charts, and time series plots are also used to establish the distribution of the survey data. In this case study several statistical methods have been used to analyze the survey data. Descriptive statistics: These include both the measures of central tendency and variation. The measures of central tendency include mean, median, and mode. These variables are used to indicate a typical value from a given sample data set. However, the most appropriate measure of central tendency to use would largely depend on the nature of distribution of the sample data. Notably, the mean is a non-resistant measure of central tendency. This is because it is usually pulled in the direction of skewness. Therefore, the mean value of a given variable may not be the appropriate measure of central tendency to use for a sample data with skewed distribution. The median is ideally the value that occupies the middle position of the distribution of a variable and is usually appropriate to use as a measure of central tendency for skewed distribution. Conversely, the mode is the most frequent value in the distribution of a given data. Measures of variation are important component of descriptive statistics. Typically, they are used to evaluate the magnitude of variations within and between values included in a dataset. The common measures of variations include standard deviation, variance, and range. The standard deviation measures the deviation of the individual sample values from the mean value of distribution. The variance is the square of standard deviation while the range is the difference between the largest and smallest values in a dataset (Chiang, 2003). Graphical techniques: There are several graphical techniques that can be used to analyze a survey dataset. However, in this case study, the histogram has been widely used to study and establish the nature of distribution of the survey sample dataset. Typically, a bell-shaped histogram is an indication that the sample data was drawn from a population with a normal distribution. Conversely, a histogram with a longer left or right tail indicates that the sample data has a skewed distribution. Inferential statistics: Typically, several hypotheses about the population of interest need to be evaluated. This is usually achieved using inferential statistics, which encompasses different tests of hypothesis. It is necessary to identify the appropriate hypothesis test to use prior to conducting any hypothesis testing (Sukal, 2013). Several types of hypothesis tests have been used to analyze the survey data. These include the two sample t-test assuming equal variance, and ANOVA. The t-test has been used to determine whether there is any evidence from the survey sample dataset to support the claim that the mean price of male razor products is higher compared to the mean price of female razor products. Subsequently, the analysis of variance (ANOVA) was used to establish whether the mean price of twin blade, 3-blade, and 5-blade razors differ. Similarly, ANOVA was also used to determine if the mean price of razors made in different countries differ. In all the three hypothesis tests conducted in this case study, an alpha level of 0.05 was used the level of significance for the respective hypothesis tests. Analysis Male and female products The descriptive statistics of the female and male razor products are as indicated in the following table. These statistics relate to the prices of products for the respective gender. These include the mean prices of female products as well as that of male products. Table 1   Female products (prices) Male products (prices) Mean 6.81 5.6 Standard Error 0.5508 0.7041 Median 6.5 6 Mode 3.5 6 Standard Deviation 4.475 2.903 Sample Variance 20.022 8.428 Kurtosis -1.277 -1.549 Skewness 0.406 -0.157 Range 14.9 8.3 Minimum 1.1 1.2 Maximum 16 9.5 Sum 449.5 95.2 Count 66 17 The average price of the female products included in the sample is AUD 6.81. This is higher compared to average price of male products, which was established to be AUD 5.60. This suggests that the female razor products in the market are generally more expensive than the male razor products. The most frequent price of the male products was AUD 6.00, while that of the female products was AUD 3.50. The minimum price of the 66 female products sampled was AUD 1.10, while the maximum price of the female products was AUD 16.00. Conversely, the minimum and maximum prices of the 17 male products included in the sample were AUD 1.20 and AUD 9.50 respectively. Figure 1 The histogram of prices of female products is skewed to the right. This is indicated by the long right tail of the histogram in figure 1 above. Notably, the histogram can be said to be positively skewed. Based on the skewed distribution of the prices of female products represented using the histogram in figure 1, the median would be the most appropriate measure to use to describe the central tendency or the typical price that a female razor product is sold in the market. The median price of the female products that were included in the sample survey data is AUD 6.50. Figure 2 The histogram of prices for male razor products is as illustrated above in figure 2. Similarly, the histogram indicates that the prices of male products have a skewed distribution. However, the shape of the histogram in figure 2 has a longer left tail an indication that the prices of male razor products are negatively skewed. Therefore, the median price would also be the most appropriate value to describe the typical price of a male razor product. The median price of male products sampled is AUD 6.00. Number of cartridges blades The sample comprised of twin blade, 3-blade, and 5-blade razors. The descriptive statistics related to the number of cartridges blades for the items included in the sample are as follows. Table 2   Twin blade 3-blade 5-blade Mean 6.12 6.42 7.61 Standard Error 0.8513 0.7095 0.8029 Median 3.5 5.25 8.5 Mode 3.5 10 12 Standard Deviation 4.5048 4.3739 3.3104 Sample Variance 20.2929 19.1313 10.9586 Kurtosis -1.302 -0.599 -0.937 Skewness 0.612 0.722 -0.500 Range 12.4 14.9 10 Minimum 1.2 1.1 2 Maximum 13.6 16 12 Sum 171.4 243.9 129.4 Count 28 38 17 The mean price of twin blade razors included in the sample is AUD 6.12. The average prices of the 3-blade and 5-blade razor products are AUD 6.42 and AUD 7.61 respectively. Based on the average prices of razors with different number of cartridges, twin blade razors are the least expensive, while the 5-blade razors are the most expensive razors. This is because the twin blade razors have the lowest average price, while the 5-blade razors have the highest average price. Notably, the average price of the 3-blade razor is higher than that of the twin blade razor but lower than the average price of the 5-blade razor. The sample data comprised of 83 razors, which included twenty eight twin blade razors, thirty eight 3-blade razors, and seventeen 5-blade razors. The standard deviation of the prices of the twin blade razors was established to be 4.5048, while that of the 3-blade and 5-blade razors were established to be 4.3739 and 3.3104 respectively. Therefore, prices of the twin blade razors had the highest variation. Conversely, the price variation of the 5-blade razors was the least among those of the sampled razors categorized depending on the number of cartridge blades. Figure 3 The histogram of prices of twin blade razors is illustrated in figure 3. The histogram has a long right tail an indication that the prices of the twin blade razors have a positively skewed distribution. Figure 4 The histogram of prices of the 3-blade razors is also positively skewed. This is illustrated by its shape, which is characterized by a long right tail. The median is usually the most appropriate measure to describe a typical value of central location for a skewed distribution. Figure 5 The distribution of the prices for 5-blade razors is skewed to the right. This is an indication that the 5-blade prices are negatively skewed. The median price of the 5-blade razors included in the sample is AUD 8.50. Country of manufacture The sample survey data constituted razor products manufactured in France, USA, and other countries. The number of sampled products that were manufactured in France was 11, while those that were manufactured in USA and other countries were 27 and 45 respectively. The descriptive statistics of the prices of razor products based on the country of manufacture are as follows. Table 3   Made in France Made in USA Made in Other Countries Mean 13.55 9.12 3.32 Standard Error 0.4071 0.3730 0.2779 Median 13.5 9 2.9 Mode 12 7 3.5 Standard Deviation 1.3501 1.9381 1.8640 Sample Variance 1.8227 3.7562 3.4744 Kurtosis -0.732 -0.771 1.919 Skewness 0.454 0.278 1.552 Range 4 6.9 7.9 Minimum 12 6 1.1 Maximum 16 12.9 9 Sum 149.1 246.2 149.4 Count 11 27 45 The average price of the razors made in France was established to be AUD 13.55, while the razor products made in USA had a mean price of AUD 9.12. The average price of AUD 3.32 for the razor products made in other countries was the least among the three categories of razor products based on the country they were manufactured. The histogram of the prices of the razor products that were made in France is as follows. Figure 6 The shape of the histogram of prices of razor products made in France is approximately bell-shaped. This suggests that prices of razor products made in France are normally distributed. Figure 7 Similarly, the histogram of the prices of razor blades made in USA is bell-shaped as illustrated in figure 7. This also suggests that the prices of razor products made in USA have a normal distribution. Figure 8 The prices of razor products made in other countries have a positively skewed distribution. This is illustrated by the histogram in figure 8, which has a long right tail. Inferential statistics Male and female products The sample data comprised of both male and female razor products. A sample of 17 male products and 66 female products formed the survey sample size of 83 items. The two sample t-test assuming equal variance was used to evaluate whether there is any evidence to indicate that the average price of male razor products is higher than that of the female razor products. Figure 9 Twin blade, 3-blade and 5-blade cartridges The analysis of variance (ANOVA) was used to analyze whether there is evidence of difference in the mean prices of twin blade, 3-blade, and 5-blade cartridges. Figure 10 The two hypotheses evaluated using ANOVA results are as follows. H0: Mean prices of twin blade, 3-blade, and 5-blade cartridges are equal Ha: Mean prices of twin blade, 3-blade, and 5-blade cartridges are not equal The level of significance used in the ANOVA test was 0.05. The p-value of the hypothesis test is greater than the level of significance. Therefore, fail to reject the null hypothesis and conclude that there is no evidence to conclude that there is a significant difference between the mean prices of twin blade, 3-blade and 5-blade cartridges. Country of manufacture The razor products included in the sample were categorized to have been made in France, USA or other countries. ANOVA is the appropriate hypothesis test to use since the sample comprises of three groups (made in France, made in USA and made in other countries). Figure 11 H0: Mean prices for different countries are equal Ha: Mean prices for different countries are not equal The level of significance used in the ANOVA test was 0.05. The p-value of the hypothesis test is less than the level of significance. Therefore, reject the null hypothesis and conclude that there is evidence of a significant difference between the mean prices for different countries. Conclusion The survey data has provided good insight about the characteristics associated with razor products in the market. The variables of interest in the data analysis included prices of razor products based on gender, number of blade cartridges, and the country in which the razor products were made. The average price of female products was established to be higher than the average price of male products. However, the price variation of female products was established to be higher compared to that of male products. Twin blade razors had the least average price compared to that of the 3-blade and 5-blade razor products. Notably, the 5-blade razor products had the highest average price. Razor products made in France had the highest average price. The razor products made in USA had a higher average price compared to those made in other countries other than France. The inferential statistics indicated no evidence to support the claim that the average price of male products is higher than the average price of female products. Similarly, the sample survey data showed no evidence of a difference in mean prices between the twin blade, 3-blade and 5-blade cartridges. However, the sample data provides evidence of a significant difference between the mean prices of razor products made in different countries. Implications The launch of a new product in the market should be done with the expectation that the product will meet the market requirements. The analysis of the market research data indicates that the female products are generally more expensive compared to male razor products. The products made in France and the USA, tend to be priced higher compared to that in other countries. Therefore, it is recommended that the company fix the prices of its female products slightly higher than the male products. In addition, to be competitive in the market the price of the new razor product should be generally lower compared to the competing products in the market that are made in France or the USA. Reference List Berghoff, H., Scranton, P. and Spiekermann, U. (2012) The Rise of Marketing and Market Research, New York: Palgrave Macmillan. Chiang, C.L. (2003) Statistical methods of analysis, World Scientific. Cooper, D., & Schindler, P. (2014) Business Research Methods, 12th Edition. McGraw-Hill. Corder, L. (2010) Marketing research management: A step-by-step guide to successfully running your own survey, Pittsburgh, PA: CorCom, Inc. Cumming, G. (2012) Understanding the New Statistics: Effect sizes, Confidence Intervals, and Meta Analysis, New York: Routledge. Freedman, A. D. (2005) Statistical Models: Theory and Practice, Cambridge University Press. Good, P. I. and Hardin, J. W. (2009) Common Errors in Statistics (And How to Avoid Them), (3rd ed.), Hoboken, New Jersey: Wiley. Green, S. B. (2008) Using SPSS for Window and Macintosh: Analyzing and Understanding data (5th ed.), Upper Saddle River, NJ: Pearson Prentice Hall. Mogull, Robert G. (2004) Second-Semester Applied Statistics, Kendall/Hunt Publishing Company. Sukal, M. (2013) Research methods: Applying statistics in research, San Diego, CA: Bridge point Education, Inc. Read More