Case Study – The consumer after COVID-19

As governments allow retail businesses to reopen after the COVID-19 crisis, business owners are concerned about whether customers are likely to return in-store and what their expectations are about the in-store experience. They are also concerned about whether the negative economic impact of COVID-19 will alter the propensity of customers to make discretionary purchases or create a shift towards cheaper alternatives. Given this backdrop, the Retailers Association (which is an industry body representing a large number of retail businesses) has decided to conduct a research in order to develop principles about customer preferences and expectations for the retail environment after COVID-19 subsides, as well as a view of the types of products and services that potential customers are likely to demand.

In this assignment, you will play the role of a researcher hired by the Retailers Association to conduct research and collect information to assist with the decision-making process. The key focus of the research will be to examine customer’s anticipated expenditure and expectations about the in-store experience after COVID-19 subsides. The Retailers Association has developed a plan to create a safe in-store environment after COVID-19 with respect to four factors, namely (i) social distancing in-store, (ii) cashless transactions, (iii) self check-out options, and (iv) hand sanitizer availability.

To understand customer’s expected behaviour and expenditure, a research project approved by the Retailers Association was implemented. The data were collected through an online survey from 2,000 customers who were randomly drawn from a database of retail store customers. Overall, 527 customers completed all the online survey questions. The respondents were given a copy of the Retailers Associations plans for in-store health initiatives and also asked to respond to this plan. Responses from these customers have been recorded in an Excel spreadsheet, “Assignment 2 Data.xlsx.”

A member of your team has suggested that when you perform this analysis, you should undertake a series of hypothesis tests to examine the following:

1. Prior to COVID-19, the average customer in the Retailers Association database historically spent $180 in bricks and mortar retail outlets. Is the expected expenditure in the first month after stores reopen different from this past expenditure?

2. The Retailers Association wants to understand whether there a significant difference in the expected future retail expenditure across demographic categories.

a. Is the customer’s expected expenditure in the month when stores reopen different across age groups?

b. Is the customer’s expected expenditure in the month when stores reopen different across genders?  

3. The Retailers Association are concerned that customers might migrate to online shopping, even after bricks and mortar stores reopen, but believe this migration might differ according to demographic factors. 

a. Is the customer’s stated likelihood of making more retail purchases online different across age groups?

b. Is the customer’s stated likelihood of making more retail purchases online different across genders?  

4. Is there any difference between customer’s satisfaction for plans on in-store social distancing procedures and the availability of hand sanitizer in-store? 

5. Can a customer’s overall likelihood of shopping in bricks and mortar retail stores after COVID-19 be explained by retail store’s plans with regards to any of the following factors:

(i) social distancing in-store,

(ii) cashless transactions, 

(iii) self check-out options, 

(iv) hand sanitizer availability.

Required:

Write a data analysis report that provides the results to each of the five hypothesis tests above and make overall recommendations to the bank so that management can use for future business decision making. Based on your analysis relating to these hypotheses, your report should focus on two key questions: 

- Will the expected level of in-store retail expenditure differ after COVID-19 and how does this expected expenditure differ across demographic groups?

- Which factor(s) in the Retailers Association health and safety plan will contribute most to customers being likely to return to bricks and mortar stores.

- Retailers Association Customer Survey

Section 1: Personal information

Please complete the following information about yourself.

Question 1 – What is your gender?

1.  Male                     2.   Female

Question 2 – In which age category you belong to?        

  1.     18 – 29 years    2.  30 – 39 years   

   3.   40 – 49 years            4. 50 – 59   years 

   5.   >= 60 years

Question 3 – How much do you expect to spend in bricks and mortar retail stores in the first month after they open?  ------

Section 2: Likelihood of Returning to Retail

Please circle the number that corresponds with your level of agreement.

Extremely Unlikely = 1   Neutral = 5   Extremely Likely = 10

Question 4 – Overall, I am likely to shop in a bricks and mortar retail store in the same way I did prior to COVID-19.

1 2 3 4 5 6 7 8 9 10

Question 5 – I will be more likely to do more retail shopping online in the future compared to my shopping behaviour prior to COVID-19.

1 2 3 4 5 6 7 8 9 10

Section 3: Determinants of Customer Satisfaction

Please circle the number that corresponds with your level of agreement.

Strongly Disagree = 1   Neutral = 5   Strongly Agree = 10

Question 6 – I am satisfied with in-store plans for social distancing once retail stores reopen.

1 2 3 4 5 6 7 8 9 10

Question 7 – I am satisfied with in-store plans for cashless transactions once retail stores reopen.

1 2 3 4 5 6 7 8 9 10

Question 8 – I am satisfied with in-store plans for self-checkout options once retail stores reopen.

1 2 3 4 5 6 7 8 9 10

Question 9 – I am satisfied with in-store plans for the availability of hand sanitizer once retail stores reopen.

1 2 3 4 5 6 7 8 9 10

Report Structure

1. Executive Summary

This section should provide a brief overview of the data analysis report. You should discuss the subject matter, the method of analysis, the findings and recommendations and any limitations of the report. It is suggested that the Executive Summary is the last section that you write.

2. Introduction

Provide a brief background to the case to put your analysis in context. Provide a discussion of the objectives of your analysis.

3. Research Design

Discuss the data collection process and the sampling procedures that were applied. In this section you should also outline the ethical considerations that would have been taken into account when collecting data from this survey and reporting your results. This section should include references from at least three credible sources, such as textbooks or journal articles.

4. Hypothesis Development

You need to develop hypothesis linked to each question (5 questions). You should mention the question first and then write corresponding null and alternate hypotheses.

For example: 

Question: How much are potential patrons willing to pay for the entrées? Is the $18 amount from the forecasting model the correct value to use when setting food prices?

Null hypothesis (H0): The average amount patrons are willing to spend on the entrée course is equal to $18.

Alternate hypothesis (HA): The average amount patrons are willing to spend on the entrée course is not equal to $18.

5. Statistical Technique and Justification

You should categorically mention which statistical technique is used to test a hypothesis. Sufficient justification should be provided for choosing a statistical technique. You should mention whether you are comparing the means or measuring the degree of relationship between/among the relevant variables. Use credible academic references.

Justification depends on

- First, the test is different or association

- Second, what type of data do you have? Categorial or continuous data,…

- Third, how many variables do you have?

For example:

To test hypothesis one,  …… test is used as this is the appropriate test to compare the difference between mean of one variable and a pre-determined mean (Zikmund, Babin, Carr, & Griffin, 2012, p. 520). The variable(s) is/are interval/ratio scale variables

6. Results, and Statistical and non-statistical Interpretation)

In this section, you should present your empirical result (using Excel) and then provide statistical and non-statistical interpretation of the result. For example:

Statistical interpretation:

From Table 1, it is evident that t-calculated (4.119) is greater than t-critical (1.967) and p-value is less than the significance level (5% level of significance), thus, we can reject that null hypothesis that the average patron is willing to pay $18 for their entrée (p-value 0.0000477) at 5% level of significance. 

Non-statistical interpretation: 

The average expenditure ($20.14) is greater than $18 (value obtained from forecasting model). Therefore, the average expenditure value should be used when pricing foods in the restaurant.

7. Analysis and Summary of the Statistical Results (15% of total marks) (about 400 words)

Synthesise the hypothesis test results as they relate to the key research questions: 

- What is the level of online fraud experienced based on demographic factors?

- What is the current level of customer satisfaction with regard to online security system? and 

- What factor(s) contributes most to the overall customer satisfaction.

Report a summary of your key findings and the conclusions that can be derived from this analysis. 

8. Recommendations

Provide recommendations to the Retailers Association. Each recommendation should be linked to one of your key findings presented in the previous section. Bullet points can be used for the recommendations. 

9. References

American Psychological Association (APA) 6th Edition of referencing style should be followed. You can find helpful examples of APA 6th ed. citation in pp 27–41 of the 2015 NBS Postgraduate Student Manual as well as at http://www.apastyle.org/index.aspx. 

Example:

Zikmund, W., Babin, B., Carr, J., & Griffin, M. (2012). Business research methods (9th ed.): Cengage Learning.

Assignment-Dataxlsx