Analysis of Variance (ANOVA)

ANOVA
A statistical method for testing whether two or more dependent
variable means are equal (i.e., the probability that any differences in
means across several groups are due solely to sampling error).
Variables in ANOVA (Analysis of Variance):
 Dependent variable is metric.
 Independent variable(s) is nominal with two or more levels – also
called treatment, manipulation, or factor.
One-way ANOVA: only one independent variable with three or more
levels.
Two-way ANOVA: two independent variables each with two or more
levels.
With ANOVA, a single metric dependent variable is tested as the
outcome of a treatment or manipulation.
With MANOVA (Multiple Analysis of Variance), two or more metric
dependent variables are tested as the outcome of a treatment(s).
 Stating The
Null and Alternative Hypotheses

H0: The means for all groups are the same

(equal).
Ha: The means are different for at least one
pair of groups.
H0: 1 = 2 = ………. = k
Ha: 1  2  ……….  k
How do you determine which means are significantly
different?

The F-statistic assesses the

statistical differences are present
somewhere between the group
means.

To identify where the differences

“multiple comparison tests” has to
be applied.
 What multiple comparison tests are available in SPSS?

Scheffe
recommended

Games-Howell
recommended
 ASSUMPTIONS

 Samples are independent.

 Dependent variable is normally distributed for each
of the samples – with larger sample sizes ( >
20/group) not a serious problem should this be
violated somewhat.
 Whether the sample sizes for the groups are very
different (ratio of 1.5 or higher may be a
problem).
 The variances for the different populations from
which the samples are drawn are equal – possibly
a problem if they are not equal or at least
comparable.
 In general ANOVA is a fairly robust procedure.
Application: One-way ANOVA
 Description of Customer Survey Variables
VS.
Variable Description Variable Type
Restaurant Perceptions
X1 Excellent Food Quality Metric
X2 Attractive Interior Metric
X3 Generous Portions Metric
X4 Excellent Food Taste Metric
X5 Good Value for the Money Metric
X6 Friendly Employees Metric
X7 Appears Clean & Neat Metric
X8 Fun Place to Go Metric
X9 Wide Variety of menu Items Metric
X10 Reasonable Prices Metric
X11 Courteous Employees Metric
X12 Competent Employees Metric
Selection Factor Rankings
X13 Food Quality Nonmetric
X14 Atmosphere Nonmetric
X15 Prices Nonmetric
X16 Employees Nonmetric
Relationship Variables
X17 Satisfaction Metric
X18 Likely to Return in Future Metric
X19 Recommend to Friend Metric
X20 Frequency of Patronage Nonmetric
X21 Length of Time a Customer Nonmetric
Classification Variables
X22 Gender Nonmetric
X23 Age Nonmetric
X24 Income Nonmetric
X25 Competitor Nonmetric
X26 Which AD Viewed (#1, 2 or 3) Nonmetric
X27 AD Rating Metric
X28 Respondents that Viewed Ads Nonmetric
 The Samouel’s Research Problem

 Dependent variable is: X27 – AD Rating

 Independent variable is X26 – Which AD Viewed
(e.g., # 1, 2 or 3):
 ‘1’ – AD #1
 ‘2’ – AD #2
 ‘3’ – AD #3
 Research question is:
 Are there differences in the mean ratings of the
ADS based on which AD was viewed?
 USING SPSS TO DO A ONE-WAY ANOVA

Phil Samouel asked the researcher to test the effectiveness of three different ads.
If the mean ratings of the ads are statistically different he would like to select the highest
rated ad and run an advertising campaign for his restaurant.
Not all of the 200 customer respondents agreed to look at and evaluate the ads. To
identify the respondents who viewed the ads we go to the Data pull down menu and click
on “Select Cases”, then on “If condition satisfied,” then on If. Next highlight variable X 28
and click on the Arrow box to move it to the box. Now click on the equal sign (=) below
and then one (1) to select only the respondents who viewed the ADS (a zero = did not
agree to view ads). Finally click on Continue and then OK.
The metric dependent variable for these hypotheses is X 27 — AD Rating and the
nonmetric independent variable is X26 — AD Viewed (# 1, 2 or 3). The click-through
sequence to run the one-way ANOVA is: ANALYZE  GENERAL LINEAR MODEL 
UNIVARIATE. Click on X 27 — AD Rating to highlight it and then on the arrow box to
move it into the Dependent Variable box. Click on X 26 — Which AD Viewed to highlight
it and then on the arrow box to move it to the box labelled “Fixed Factors.” Click on the
Post Hoc box and highlight X26 in the Factor(s) box and then click on the Arrow box to
move this variable to the box for Post Hoc Tests. Now look to the lower left side of the
screen and click on Scheffe test and Games-Howell and then Continue. Now go to the
Options box and click on Descriptive statistics and Homogeneity Tests (Levene test of
equal variances) and then Continue, and then click on the Plots box and highlight X26
and move it to the Horizontal Axis box and then under Plots below click Add. Finally,
click on Continue and then OK to execute the program.
Initial Considerations – Descriptives &
Levene’s Test of Equal Variances

There is not a significant

difference in the variances of
the three groups.
The Restaurant Problem: Tests of Between Subjects Effects

There are significant differences

between ratings for the ads, but
we are not sure where the
difference are based on this test.
AD Evaluations: Post Hoc Tests

There are significant

differences between
ratings for all three ads.
The Restaurant Problem – Profile Plot

Mean Ratings of Ads:

1. Ad #1 = 39.79
2. Ad #2 = 68.03
3. Ad #3 = 51.50
Two-way ANOVA
 Two-way ANOVA?

 Examines the effect (if any) of two or more non-

metric independent variables on a single metric
dependent variable.
 Total variation is examined for:
 Variation due to each of the independent
variables (main effects).
 Variation due to the interaction of the
independent variables – that is their possible
combined effect on the dependent variable
beyond the separate influence of each
(interaction effect).
 Variation that remains unexplained (error).
 Two-way ANOVA?

 Three hypotheses are tested simultaneously:

1. The effect of independent variable #1 on
the dependent variable (main effect).
2. The effect of independent variable #2 on
the dependent variable (main effect).
3. The combined (joint) effect of
independent variables #1 and #2 on the
dependent variable (interaction effect).
 ANOVA Terms

Main Effect = the impact any single experimental

variable has on a response (dependent) variable.

Interaction Effect = the combined impact of multiple

independent variables on a response variable; i.e., is
the difference in the mean ratings of the ads
(response variable) the same when we compare
males and females?

Blocking Variable = a grouping variable the

researcher doesn’t manipulate or control in any way,
such as gender.
 Samouel’s Restaurant: The Problem And The Design

Phil Samouel asked the researcher to test three different ads for
their effectiveness. If the ratings of the ads are statistically different he
would like to use that information to attract more customers. He also
would like to know how various demographic characteristics are related
to ad ratings. In this case, we use gender, which is referred to as a
blocking variable. The null hypotheses are:

(1) No differences in ad ratings based on which ad was viewed;

(2) No differences in ad ratings based on gender;
(3) No differences in ad ratings based on the combined effects of
which ad viewed and gender.

The metric dependent variable for these hypotheses is X27 — AD

Rating and the nonmetric independent variables are X26 — AD Viewed (#
1, 2 or 3) and X22 — Gender.
 Using SPSS To Execute Two-way ANOVA

Recall that not all of the 200 customer respondents agreed to look at and
evaluate the ads. To identify the respondents who viewed the ads we go to the
Data pull down menu and click on “Select Cases”, then “If condition satisfied,”
then on If. Next highlight variable X28 and click on the Arrow box to move it to
the box. Now click on the equal sign (=) below and then one (1) to select only
the respondents who viewed the ADS (a zero = did not agree to view ads).
Finally click on Continue and then OK.
The click through sequence is: ANALYZE  GENERAL LINEAR MODEL 
UNIVARIATE. Highlight the dependent variable X 27 — AD Rating by clicking on
it and move it to the Dependent variable box. Next, highlight X 26 — AD Viewed
and X22 — Gender, and move them to the box labelled “Fixed Factors.” Now
click on the Post Hoc box and highlight X 26 in the Factor(s) box and then click
on the Arrow box to move this variable to the box for Post Hoc Tests. We do
not move X22 because it has only two groups and not three. Look to the lower
left side of the screen and click on Scheffe test and then Continue. Now go to
the Options box and click on Descriptive statistics and then Continue, and then
click on the Plots box and highlight X 26 and move it to the Horizontal Axis box
and then click the Add button above the Plots box below. Finally, click on
Continue and then OK to execute the program.
SPSS Output For The Two-way ANOVA –
Initial Data

Sample sizes for

each of the groups.

Mean ratings of ads

by which ad viewed
and gender.
SPSS Output For Two-way ANOVA

• AD Rating main effect significant (X26).

• Gender main effect not significant (X22).
• Interaction effect significant (X26 * X22).

If the interaction effect

is not significant, the
main effects of the
treatments are
independent and can
be interpreted directly.
If the interaction
effect is significant,
then the type of
interaction must be
determined.

The significant interaction and

nonsignificant main effect for X22
raises a red flag.
Post Hoc Tests For Two-way ANOVA

All comparisons
significantly different.
Two-way ANOVA – Profile Plot AD Viewed

The three ads are rated differently,

with ad #1 rated lowest at 39.79, #3
somewhat higher at 51.50, and #2
the highest at 68.03.
Two-way ANOVA – Profile Plot - Gender

There is a difference in
ratings by gender across all
three ads, with female ratings
overall slightly more
favorable (55.55 vs. 54.56).
But remember overall there
was not a statistically
significant difference.
AD Rating By “Which AD Viewed” and “Gender”

There is a significant
difference between
AD Ratings by males
and females for ads
#1 and #3, but not for
ad #2.
AD Rating By “Viewed #1”
and “Gender”
AD Rating By “Viewed AD #2”
and “Gender”

Note: do not be
fooled by the
slope of the line
– the mean rating
for males is 68.5
and for females
is 67.8.
AD Rating By “Viewed AD #3” and
“Gender”