The kitchen appliances retailer seeks to survey its customers to gain insights into key consumer characteristics, including demographic profiles and lifestyle preferences. It is believed this will help the company better understand its target consumers and strengthen its position in the market. However, before outsourcing the data collection fieldwork, the retailer seeks clarification on data types, as outlined in the requirements below. 

 

1. With reference to examples relevant to the retailer's information needs, discuss the differences between cross-sectional data and time series data and clearly state whether cross-sectional data, time series data or both types of data should be collected to gain insights into the demographic profile and lifestyle characteristics of its customers. 

 

Time series data is data that focuses on analyzing a single individual at different times usually at uniform intervals. It is data gathered on the same variable over a period of time such as months, quarters, and years. Tie series data is usually a set of observations collected at usually discrete and equally spaced time intervals. It also can be defined as a pattern of data points indexed that is listed or graphed in time order. It is mostly taken at successive equally spaced points in time. An example of time series data is the profit returns of Tuskys at the end of the financial year 2020, 2019, 2018.

Step-by-step explanation

On the other hand, cross sectional data are observations that come from different individuals or groups at a single point in time. Therefore, it is a set of observations taken a single point in time. Specimens are made by gathering data of interest across a range of observational units. Such a good example of cross sectional data is the profit returns of Tuskys, Quickmart and naivas as at 31^st Dec, 2020.

The main differences between time series data and cross sectional data is that for time series data observations are made on a single variable/individual/group on multiple time intervals whilst cross Sectional data consists of observations made on many subjects at the same point in time. Time series data focuses on the same variable over a period of time whilst cross sectional data focuses on different individuals/groups at the same point in time. The kitchen appliance retailer should apply the cross sectional data as it plans to carry a survey on the consumers, their characteristics at a single point in time.