Administrators at a large grocery store have noticed a big drop in their revenue

Question

Administrators at a large grocery store have noticed a big drop in their revenue so they decide to conduct a survey study to learn more about their customers and find out how they can attract more.

They plan to have two staff members stand at the main entrance of the store Monday-Friday, from 9am-5pm for one week on December, 2017 to greet shoppers and to invite them to answer a few questions. Willing shoppers are asked demographic questions (e.g., age, numbers of people in the household, gender), questions related to grocery shopping habits (e.g., number of monthly visits to the grocery store, other places they purchase groceries in a typical month) as well as the following questions: “The grocery store invests a huge amount of our budget to offer our customers a wide variety of high quality produce year-round. Are you satisfied with our produce selection? What else can we do to attract shoppers?”

The grocery store administrators recognize there are problems with their plan so they ask your group for advice on how to improve it. Briefly describe improvement(s) to their plan that would reduce selection bias and measurement bias.

Explanation / Answer

Goal of the study is to improve the dropping revenue and to find out the means to focus on attracting more customers. Population selected for the study is the customers coming to the store from Monday to Friday, during 9am to 5pm in a week on December 2017. Type of study used to identify the needs and wants of the customers is the survey, requesting the customers to answer a few questions related to grocery shopping habits.

Source of the sample data is the populating visiting the grocery stored in the month of December. Grocery store is not using any incentive to participate in the survey to get a result in favor of their objective, distorting the participants towards self-serving position is not their interest of study. The Participants are not paid to participate in the survey, and not from their own staffs in the list of the population. Month of December is the peak shopping time due to the holiday season. So the sources for the selection bias is carefully avoided in this type of study. But the question is why a big drop in revenue. Customers are coming to the grocery store, but not purchasing the groceries, or the loyalty of the customers shifting to the more attracting offering from the other stores. So the study shall include the customers who are not coming to the stores also. Survey is targeted on the customers who are interested in purchasing groceries is good option.

Sampling method of asking all the customers who is coming the stores that is a good intention of the grocery store to study the population without any selection bias.

Selection bias happens when the sample selected is not the representative of target population. So the conclusions to be drawn from the sample data about the population is biased due to the selection bias of the sampling method.

Variables of interest measured if the customers satisfied with the produce selection of the grocery store and asking about the expectations of the customers to attract more shoppers, is 1. Customer satisfaction, 2. Attracting attributes of the produce selection and the service of other stores. There are missing variables that would lead to the invalid conclusion. For example, question related to quality, cost, and delivery in addition to the customer selection.

Wording and setting of the survey question is of more open type with the second question, and of very specific with a closed question like if the customers satisfied with the produce selection. These questions are specific in their nature towards the goal of increasing the revenue that may not capture the needs and wants of the customers. This will cause measurement error due to the open questions in the survey.

We should look for the measurement bias and selection bias that distorts our conclusions if they helped to achieve the goals of the study, which is to find out how to improve the dropping revenue. The sampling method, study questionnaire, and sample variable like mean and standard deviation are making sense together to meets the population parameter study. And the conclusion of the parameter have any practical significance.

From the report, the question the store used to study population, has not produced any positive results. Still the revenue is dropping. Underlying characteristics of the sample data needs to be improved with the better specific question and including more populations to participate to avoid selection and measurement bias.

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