Calculating Sample Size Step By Step

In this blog I will explain step by step how to apply sample size formula on the specific problem. In order to determine how big your sample size should be for survey you need to understand how to apply the right formal in your calculation. In the business world having knowledge in this area will help you be more successful and can be crucial when conducting a survey.

I will use steps from The Marketing Research Toolbox: A Concise Guide for Beginners book to explain the process of calculating sample size in the practice problem from the book:

“To determine the effectiveness of an ad campaign for a new DVD player, management would like to know what percentage of the market has been made aware of the new product. The ad agency thinks this figure could be as high as 70 percent. In estimating the percent aware, management has specified a 95 percent confidence interval, and a precision of ±2 percent. What sample size is needed?”

In order to successfully calculate what sample size management should use to find out if customers are aware of new DVD player and effectiveness of their advertising campaign.

There are three steps we will go over which are mentioned in the book. First we need to square the Z value associated with the desired confidence interval. Second we need to multiply it by the population variance. Third we need to divide it by the square of the desired precision.

Now we will use following steps and apply them in our problem from the book. Management has decided they want confidence level of 95 percent looking at the page 30 says that in that case Z value is equal to 2. Next we need to find population variance and the formula for determining the variance is (Variance + proportion #1 x (1 – proportion #1)). In problem we are looking at variance is 0.70

Applying this formula calculation for variance equals 0.70 x (1 – 0.70) = 0.21. Now when we found all the number we need, we can calculate the sample size:

2² x 0.21 / (0.02) ²
= 2100

Based on our results our sample size should be 2100 people in order to achieve results management has set. I believe having confidence level of +- 2 in this particular problem and sampling 2100 people seems like a reasonable choice in order to find about what is awareness of costumers on new DVD player.

ABOUT EVALUATION SURVEYS

 

In our class we recently learned about different types of surveys. It could be the questionnaire and the interview. Difference between the two is that questionnaires are short-ended questions and interview is more open-ended. In this blog post I will talk about questionnaries types of survey and what are some benefits of conducting them. Questionnaire types of survey could be evaluative or they could simply describe customers characteristics and behaviors. In my opinion evaluative surveys are more beneficial to the organization in order to find out more about what needs to be improved and overall how customers feels about their performance. As a customer I was exposed to both type of surveys, it takes same time to complete either of them, but through evaluation survey I felt like my answers where more personal and I was able to express more how I feel about the company and their performance by simply circling my response on agree/disagree scale.

On good example of evaluation survey that every college student is exposed to at the end of each semester is course evaluation survey. We are asked one scale from strongly disagree/disagree/natural/agree/strongly agree to answer questions about the course and instructor’s performance. It is very useful for professors to find out what could be changed when it comes to course concept and their behavior. Evaluation surveys do not take much time complete since you only have to circle with which statement you agree/disagree with. As a student I really enjoyed doing this type of survey because I felt like I was able to truly reveal where I stand when it comes to a certain course and professor.

In the business world this type of surveys are very beneficial because they reveal how customers feel about different aspects of their organization straight from them and it is easy to find out where it needs to be improved. If I was a customer I would enjoy to conduct this type of survey because it is not a big time commitment and it is usually just short statement that we need to agree/disagree on. On the other side, organization which is conducting this type of survey is able to in a fast and efficient way learn more about customer satisfaction straight from their answers. It is easy to conduct and collect these surveys and draw conclusions from their responses which could make big changes for the company. Conducting evaluation surveys online is a good way to reach to people nowadays. They are able to do it on their own time and in private, so they will be more honest they if a person from organization is standing right by them. Looking at the cost side of it, beside finding a target group e-mail addresses, it is not an expensive marketing tool and it is really powerful.