Marketing Analytics

Assignment No 1
Narender Gupta
Roll No. 002(Sec.A)
Q1. The file logitsubscibedata.xls gives the number of people in each age group
who subscribe and do not subscribe to a magazine. How does age influence the
chance of subscribing the magazine?

Data Summary:
Age
Group
20-24
25-29
30-34
35-39
40-44
45-49
50-54
55-60
20-24
25-29
30-34
35-39
40-44
45-49
50-54
55-60

No Sub
52
61
57
73
56
84
57
87
44
53
57
54
56
83
77
74

Sub

Gender
31
30
18
14
17
8
8
9
46
37
30
12
12
19
17
12

0
0
0
0
0
0
0
0
1
1
1
1
1
1
1
1

Mean
Age

Total
22
27
32
37
42
47
52
57
22
27
32
37
42
47
52
57

83
91
75
87
73
92
65
96
90
90
87
66
68
102
94
86

Solution:
Logit Regression can be used to determine the impact of independent
variables age and gender on the subsicription of magazine by a given
individual

SPSS Output:
Omnibus Tests of Model Coefficients
Chi-square

Step 1

df

Sig.

Step

94.806

.000

Block

94.806

.000

Model

94.806

.000

Hosmer and Lemeshow Test

Step
1

Chi-square

df

13.370

Sig.
8

.100

High p value of .1 (significantly greater than .05) indicates that there is no

significant difference between predictions by the model and observed values.

Variance explanation by model Summary: We use model summary is used to

measure variation in the dependent variable that is explained by the model

Model Summary
Step

-2 Log likelihood

1381.112

Cox & Snell R

Nagelkerke R

Square

Square

.068

.102

a. Estimation terminated at iteration number 4 because

parameter estimates changed by less than .001.

Nagelkerke R Square is a modification of Cox & Snell Square. The explained

variation in the dependent variable based on our model ranges from 6.80%
to 10.2%. Cox & Snell R square cant achieve a value of 1,so we use
Nagelkerke R Square value

Classsification Table: If the estimated probability of the event occurring is

greater than or equal to 0.5 (better than even chance), SPSS classifies the

event as occurring (e.g., subscription of magazine). If the probability is less

than 0.5, SPSS classifies the event as not occurring (e.g., no subscription of
magazine). It is very common to use binomial logistic regression to predict
whether cases can be correctly classified (i.e., predicted) from the
independent variables.
Classification Tablea
Observed

Predicted
Subscribe?
0

Step 1

Subscribe?

Percentage
Correct

1025

100.0

320

.0

Overall Percentage

76.2

a. The cut value is .500

The percentage accuracy in classification (PAC), which reflects the

percentage

of

cases

that

can

be

correctly

classified

as

"no"

subscription of magazine with the independent variables added.

In our case is 100%: Sensitivity, which is the percentage of cases that had
the observed characteristic (e.g., "yes" for subscription of magazine) which
were correctly predicted by the model (i.e., true positives).

In our case is 0%: Specificity, which is the percentage of cases that did not
have the observed characteristic (e.g., "no" for subscription of magazine)
and were also correctly predicted as not having the observed characteristic
(i.e., true negatives).

In our case is 76.2%: The positive predictive value, which is the percentage
of correctly predicted cases "with" the observed characteristic compared to
the total number of cases predicted as having the characteristic.

The negative predictive value, which is the percentage of correctly predicted

cases "without" the observed characteristic compared to the total number of
cases predicted as not having the characteristic.

Variables in the Equation

Variables in the Equation
B
Age
Step 1a

S.E.

Wald

df

Sig.

Exp(B)

-.052

.006

78.998

.000

.949

Gender(1)

.407

.134

9.264

.002

1.502

Constant

.598

.231

6.701

.010

1.818

a. Variable(s) entered on step 1: Age, Gender.

From these results you can see that age (p = .00), gender (p = .002) Shows
that it is a significant model/prediction. We can use the information in the
"Variables in the Equation" table to predict the probability of an event
occurring based on a one unit change in an independent variable when all
other independent variables are kept constant.
Probability of subscription =
0.052*Age}

e{.598+0.407*Gender

1+ e{.598+0.407*Gender 0.052*Age}

Conclusion
A logistic regression was performed to ascertain the effects of age and
gender on the likelihood that participants have subscribe the magazine or
not. The logistic regression model was statistically significant, 2(4) =
94.86, p < .0005. The model explained 10.20% (Nagelkerke R2) of the
variance in subscription and correctly classified 76.2.0% of cases. Females
were 1.52 times more likely to subscribe the magazine than males.
Increasing age was associated with less l subscription of magazine.