Correlation or Causation: The most common errors made in data analysis

The research field is prone to errors with significant consequences on generalizing results and interpreting statistical relationships.The following are some of the most common:

statistical errors

  1. Assuming you have a representative sample: This error is common especially in large data sets (big data). The results may look convincing, but the sample does not represent a true picture of the target population.
  2. Measurement errors: Assuming the data has been measured correctly.  Often we get more bad data than good data and you need to adjust for this.
  3. Correlation versus Causation  – There is no statistical test to prove/ disprove whether two things are correlated versus whether one is causing the other to occur. Yet many researchers make this common error of assuming causality instead of correlation.
  4. Assuming that the data represents what you think it does: For example, not because a large proportion of prisoners are from high school A, means it’s correct to conclude that high school A is responsible for producing criminals.
  5. Reliance on features that are destined to change. Some numbers are bound to be way off when circumstances change. Daily and weekly fluctuations are easy to notice, but predicting what will happen one year from now is a different story. No matter how well a research explains current and past results, predicting the future based on current information has many limitations.
  6. Not understanding the impact that algorithm (different statistical tests) choice have on final results. Using different types of algorithms — say, random forest instead of logistic regression — may often have a significant impact on final results.

Can you think of any common errors you might want to add? Please share in the comments below

Understanding Dependent & Independent Variables #Animation

In doing research and data analysis, many have struggled with differentiating between the dependent and independent variables when running statistical tests and/or experiments. A clear understanding of these two concepts will play a major role in an individual’s thinking as a researcher/ experimenter.

This animation seeks to address this common challenge of differentiating between the independent & dependent variables in a research.

Are You Satisfied?

What is satisfaction? How do we ask questions about satisfaction? Is there a best approach?

Love customers

Here we present some tips and best practices for asking satisfaction questions in a survey.

At Balcostics our mission is to empower leaders with the required data and information to make better decisions. Learn more about our full list of research outsourcing services for individuals and companies: Click here

Qualitative & Quantitative Sampling Methods

Research is a systematic approach to collecting, entering and analyzing data. The process of data collection begins with determining which ‘sampling method(s)’ one will use – qualitative or quantitative.

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This slideshow provides a practical ‘how-to guide’ in sampling techniques, looking at the qualitative versus the quantitative approaches.

 

At Balcostics our mission is to empower leaders with the required data and information to make better decisions. Learn more about our full list of research outsourcing services for individuals and companies: Click here

The Art of Survey Design

Surveys like products work best when we have a well thought out design. More researchers need to pay attention to how they design their surveys. We found this insightful slideshow which highlight some tips and best practices.

 

At Balcostics our mission is to empower leaders with the required data and information to make better decisions. Learn more about our full list of research outsourcing services for individuals and companies: Click here

Market Research & Emerging Markets

Another thoughtful answer to a question many have asked: How do we approach market research in an emerging market like Jamaica?

 

IMG_00000153We found this insightful, yet simple answer on Quora:

“Market research is a very important part of a business and when you are entering into an emerging market it is of utmost importance that you have put enough efforts in the market research.

You can avail the secondary data through internet, periodicals, research papers, group literature, trade associations, etc. All of these data you can avail at a very minimal expenditure.

For the primary data you really need to spend the money. Money spent on consumer market research depend upon type of customer segment you want to deal with, where your customers are located and type of business (B2B or B2C).

For example if your customer segment comprises of older people it is evident that you can not float a survey to collect data on internet as they are not very familiar with filling surveys online; so you have to go out and complete the survey manually. Hence, that will increase your expenditure. Similarly, if you are dealing in a B2B business money and efforts spend in market research will be less as compared to a B2C business.

Also, just don’t put too much efforts and money in market research, you should have adequate data with you and with that data enter into market. Don’t just miss your time in doing more and more research (I know that’s too bookish but it’s true).”

See the original question and answer here

Market Research Basics

The following question was asked on Quora: “How do you conduct market research?”

This answer by Cate Riegner, was as simple and concise as we could do, so here is it:

Balcostics Research

“Think in terms of different methodologies and consider which ones are right for your needs at various stages of business development, product development and marketing:

1. Syndicated/secondary research: This would be research conducted on/for a particular market that provides market sizing information, penetration data, trending data, etc. Search for published findings at trade organization sites, investment sites, etc. The challenge is finding a study that is relevant to your specific needs, and many charge a fee for a published report.

2. Custom quantitative: If you want quantitative data or feedback on a very specific subject related to your product (e.g., behaviors, attitudes, product concept testing), consider doing your own survey.  The challenge here is making sure your sample is “representative” of the market you want to study, your survey is designed well (e.g., no leading questions, appropriate scales), you process and report data accurately. There are great, affordable survey programming/hosting tools out there (e.g, SurveyMonkey), but you need to pay for sample, survey design and possibly analysis depending on your needs.

3. Custom qualitative: This might be user testing, ethnography, interviews, blind-shopper stuides, focus groups (either online or offline). People put a lot more weight on quantitative data (because it is statistically reliable), but I am a huge advocate of qualitative research for deeper, richer insights.  Don’t discount it just because the sample size is small. The question you need to consider here is: Which approach/method is best for what I want to learn/problem I want to solve?  Each of the types of qualitative research I listed above is better for different needs.

4. Analytic data: A lot of data is generated for free online, through traffic logs, blogs, etc. The challenge here is collecting the data and conducting an analysis/generating findings that can be applied to your specific question/problem you are trying to solve.”

Check out all the answers to the above question on Quora.

SMEs & Market Research

Many Jamaican entrepreneurs (or entrepreneurs to be)  have asked/ or is still asking themselves’ the above question – is market research needed for my new idea?

We’ve found some external insights on the topic, which we hope will provide additional clarity.

 

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Question as answered by Amy Shropshire on Quora:

Most of the mistakes I’ve seen businesses of any size make have been due to the thinking they know the market place rather than taking the time to actually find out.

For the past 15 years, I’ve been advising clients in the nonprofit and start up world. What I love about them is their eagerness to get going, get their product or service into the hands of their market, and see their dreams come true. The challenge comes when I ask them questions about their market and they can’t answer them. They know all about them, and nothing about their consumers. They expect to put their product out there, do “marketing,” and make millions.

I eventually created a workshop called “No One Cares About You.” where I explained that deep down, consumers don’t really care about you. They care about how you’re going to solve their problem/need/want/desire/etc. And that’s what market research tells you how to do.

I disagree with what Shashank PS says about a completely new product being unlikely benefited from market research. This is where research will benefit you the most – Who exactly is your market? Does the market even want your product/service? Does it fill a need they have? If they don’t know they need it, how can you convince them they do? What channels do they like to be reached on. How much would they be willing to pay? The questions are endless.

I find that most people want to find a way to skip the market research part because its seen as boring. They want to jump right into the fun stuff! But let me finish by saying that the better you know every facet of your market, the more they will want to know you. =)

Question as answered by Matt Bertuzzi on Quora:

There are compelling arguments here for both sides. I have 2 quick thoughts:

1) Market research can hugely beneficial – not unlike learning about the structure of the face and effects of physics. Market interactions are like getting punched in the mouth 1st hand. Imho, you learn more from the 1st and know more from the 2nd.

2) I had no idea I wanted 1k songs in my pocket until I heard Steve Jobs tell me I could have it. Similarly, I might have scoffed at the idea/concept of Twitter in a conference room. But after week 1 using it, I was hooked.

Just my $.02.

See more interesting answers to this question here

At Balcostics our mission is to empower leaders with the required data and information to make better decisions. Learn more about our full list of research outsourcing services for individuals and companies: Click here