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Categorical Data

A number of reliable publications ran this story: " Public prefer McDonald's quarter pounder to Wendy's 1/3-pound hamburger." Wendy's designed their new hamburger to usurp McDonald's lead in the market with the quarter pounder. Wendy's ads pointed out that their hamburger hadmore meatthan McDonald's. However, a majority of the buying public (in the USA) chose the McDonald's quarter pounder over the Wendy's 1/3 pounderbecause they thought it had more meat!

What is the fundamental statistical error here and how do you think a majority of hamburger buyers in the USA made the wrong choice (assuming they actually did want one with more meat)?

The fundamental statistical error, in this case, is the level of significance error or Type I. The error primarily occurs when individuals or groups falsely reject the null hypothesis, which is actually true (Kim, 2015).For instance, in this case, the truth is thatWendy's 1/3-pound hamburger has more meat than the McDonald's quarter pounder, yet the public believes that the latter has more meat than the former. The null hypothesis,in this case, is that Wendy's 1/3-pound hamburger has more meat than McDonald's quarter pounder because it was developed to meet that need better than its competitor among the target populations. The primary cause of such errors is people's perceptions about more popular brands.

There is no doubt that McDonald's quarter pounder is more popular than Wendy's 1/3-pound hamburger among Americans. As a result, people's perceptions about its meat content are guaranteed despite the possibility that there are products that could have more of the content within this market.According toKim (2015),perceptions based on the popularity of an idea or product can skew people's responses to the null hypothesis. For example, in this case, the Americans believe that therecan be no otherhamburgerwith more meat content than McDonald's, yet, the truth is thatWendy's hasmore of this element in the product.Therefore, most Americans made the wrong choice based on the popularity of one brand over the other.Furthermore, theads would have also contributed to the problem as most people have the perception that advertising against acompetitiveproduct implies that one admits fault. Overall, the type I error resulting from people's perceptions, brand popularity, and advertisement flaws is the fundamental error in this scenario.

References

Kim, J. (2015). How to choose the level of significance: A pedagogical note.https://mpra.ub.uni-muenchen.de/69992/.