CASE 6: SAMPLING

Banks start image repair over financial crisis

In the first months of 2010, U.S. Banks have launched a campaign that aims to win back trust of
their consumers and repair their battered images. For banks, it is very important to rectify the
violation of trust caused by the financial crisis if the financial sector is to be brought back to
health. A large-scale image-improvement campaign should therefore convey that banks have
learned from their mistakes and are taking less risk with their customers' money. The challenge
facing the industry is a difficult one however: In a poll conducted by the Gallup Organization in
2009, only 19% of Americans surveyed was confident in the integrity of banks, down from 41%
4 years earlier and the lowest level since Gallup began examining the integrity of bankers in
1976. And yet, even though banks realize that reputation improvement will be a slow, labor-
intensive and cost-intensive operation, Rachel Dawes, a marketing executive of The Citizens
Bank of America, points out that the financial services industry is dedicated to earning back the
trust of the American people, and is engaging in a comprehensive effort to communicate directly
with them. According to Rachel "it is clear that we have made mistakes and we recognize that
we cannot simply advertise our way out of these issues."

Ralph Tanner, a Master student in Marketing Management is using his Masters project to
investigate how U.S. banks can improve their image. He believes that understanding the current
and desired image is vital to effectively repairing the battered images of banks. Therefore, Ralph
wants to thoroughly understand consumers' perceptions of banks. Six weeks ago, he and his
thesis supervisor have concluded that both qualitative and quantitative research is needed to
develop and test a conceptual model of brand image of U.S. banks. This model should enable
banks, such as The Citizens Bank of America, to gradually improve their image.

Just two weeks ago, Ralph has executed the first part of his project; an exploratory, qualitative
study that aimed to identify the factors that play a role in shaping the overall image of U.S.
banks. This qualitative study has resulted in a conceptual model of the image of banks in the U.S.
"through the eyes of the consumer". At this moment, Ralph is working on the quantitative study.
This study aims to test his conceptual model, generalize the findings of the qualitative study to
the population, and eventually establish how banks can effectively improve their corporate
image.

Ralph has spent the last few days on thinking about the method, sample, and procedure of his
quantitative study. Because he finds that it is important to test the relationships between the
variables in his conceptual model in a natural setting, Ralph has opted for a field study with
minimal researcher interference. For this purpose, he has developed a questionnaire, in which
consumers are asked to provide their overall perceptions toward banks and their perceptions
toward six relevant factors that shape this overall image, such as diligence, competence, and
reliability.

An understanding of the factors that shape overall image may help banks to improve their overall
image. For instance, if banks are momentarily perceived as not very reliable, and if this factor
turns out to have a significant effect on overall image, efforts in improving reliability will
eventually result in a more positive overall image of banks. Ralph has decided to use an indirect
method (regression analysis) to establish the effect of these contributing factors on the overall
image of U.S. banks.

Ralph wants to send the questionnaire he has developed to everybody in his mail directory. This
mail directory includes friends, family, members of the Golden Gate Park tennis club and the Phi
Rho Omega Marketing Students association, and the staff of Da Paolo, a small Italian restaurant
where Ralph has a part-time job allowing him to earn some extra cash during the weekends. His
mail directory includes a total number of 254 people.

2. Define the population of Ralph’s quantitative study.

3. Is Ralph using a sampling frame? Please explain.

4a. According to Ralph’s supervisor, the proposed sampling method is subject to coverage error.
Please explain why.

4b. Do you think that coverage error is problematic in this case? Why and how? Is there anything
that Ralph can do to solve this problem?

5. Is Ralph putting forward a probability or a non-probability sampling technique in his

quantitative study? What specific sampling technique is Ralph putting forward?