Question

WHICH STORE SHOULD BE CLOSED AND WHY?

Simple Regression Models Case Study: Mystery Shoppers

Chic Sales is a high-end consignment store with several locations in the metro area. The company noticed a decrease in sales over the last fiscal year. Research indicated customer satisfaction had decreased and the owner, Pat Turner, decided to create a mystery shopper program.

The mystery shopper program lasted over a 6-month period, employing several loyal and new customers assigned to each location. Surveys were on a 100-point scale and involved categories such as “Staff Attitude,” “Store Cleanliness,” “Product Availability,” and “Display(s) Appeal.”

After the mystery shopper period concludes, Mrs. Turner sends you the following e-mail:

From: Pat Turner
Sent: Thursday, July 7, 2016 8:57 a.m.
Subject: Mystery Data Shopper Stats and Store Performance?

Good morning! Welcome back from vacation J I hope you had a wonderful Fourth of July.

The last mystery shopper surveys came in and I have the final numbers. I am interested in whether there is a way to predict the final average based on the initial survey score. Also, is there a statistically significant relationship between how stores initially performed and what the overall average is?

The initial survey score and the final average data for all seven store locations is in the table below:

Store	1	2	3	4	5	6	7
Initial Survey Score	83	97	84	72	85	64	93
Final Average	78	98	92	75	88	70	93

Also, how good is the relationship between Initial Survey Score and the Final Average? Could I use an Initial Survey Score to predict a Final Average? In fact, could I predict a Final Average if I have an Initial Survey Score of 90?

If you could have this to me before the weekend, that would be great.

Thanks so much!

Pat Turner, Owner

Chic Sales Consignment, LLC

Answer 1

We are interested in whether there is a way to predict the final average based on the initial survey score. Also, is there a statistically significant relationship between how stores initially performed and what the overall average is?

Also, how good is the relationship between Initial Survey Score and the Final Average?

Could I use an Initial Survey Score to predict a Final Average? In fact, could I predict a Final Average if I have an Initial Survey Score of 90?

To predict the final average based on the initial survey score we use Regression analysis.

The regression output of the initial and final average is

The regression equation is

This relationship has p-value 0.0025<<0.05. So we conclude that there is a statistically significant relationship between the two variables.

We can predict the final average by using the regression equation. To predict a Final Average if Initial Survey Score of 90