Matched pairs design on Bestseller Book Prices on Amazon and Flipkart.

Joshua Sabherwal

Introduction:

Flipkart and Amazon are the biggest electronic commerce websites when it comes to the
sale of books in India. Now the question is, do bestsellers on Amazon sell cheaper than on
Flipkart? I have noted the prices for 40 bestselling books that I have come across throughout
my life to determine which website sells cheaper books and if there was a difference in price
on average. I expected both Flipkart and Amazon to sell the books at the approximately the
same prices based on visual inspection of the two websites.

The null hypothesis for this significance test is that there is no difference between the prices
of Books on Amazon (1) and Flipkart (2) (H0: 1-2=0).
The alternate hypothesis is that there is a difference between the prices of Books on
Amazon (1) and Flipkart (2) (Ha: 1-20).

The population for our study is the bestselling books available for sale on Amazon and
Flipkart.
My sample is the 40 bestselling books I have specifically selected for this survey that are
available on Amazon and Flipkart

Variables: Da Vinci Code, Fifty Shades of Grey, Angels and Demons, Twilight, Harry Potter
and the Philosopher's Stone, The Hound of The Baskervilles, The Invisible Man, The
Hitchhiker's Guide to the Galaxy, A Thousand Splendid Suns, The Hunger Games, The Book
Thief, The Alchemist, Hannibal, The Lord of the Rings, The Boy in the Striped Pyjamas, P.S. I
Love You, Jane Eyre, Frankenstein, Tuesdays with Morrie, To Kill a Mockingbird, Life of Pi,
Perks of Being a Wallflower, The Fault in our Stars, Looking for Alaska, Percy Jackson: The
Lightening Thief, The Girl On the Train, Divergent, The Diary Of A Wimpy Kid, War And
Peace, Moby Dick, The Great Gatsby, The Adventures of Huckelberry Finn, Pride and
Prejudice, Lolita, Alice's Adventure in Wonderland, Great Expectations, Anna Karenina,
Gulliver's Travels, David Copperfield, Three Men In a Boat.

Methods:
For data collection purposes, I visited the Flipkart and Amazon and noted down the prices
for the books listed above. I avoided bias within my data collecting process by choosing the
same books and coming up with a list before the study. I made sure to collect books both
the sites currently have to avoid
bias. Despite the fact that prices will vary from location to location, price
difference should not vary due to competition. I believe that the prices obtained are similar
as Flipkart and Amazon are in competition with each other.
Using matched pair design, I used the 95% confidence interval to test the statistical
significance between Flipkart and Amazon book prices to determine whether there is a
difference or not. : The statistical test conducted to analyse the results from the survey was
the two-tailed t-test at the =0.05 significance level. The difference: Amazon price Flipkart
price.

Calculation:

Descriptive Statistics for variable 1 (Amazon book prices):

Column n Mean Variance Std. dev. Std. err. Median Range Min Max Q1 Q3 Sum
Amazon Price 40 218.45 2544.8692 50.446697 7.9763231 200 200 149 349 198 249 8738

The Distribution for Amazon prices is a normal distribution:

Descriptive Statistics for variable 2 (Flipkart book prices):

Column n Mean Variance Std. dev. Std. err. Median Range Min Max Q1 Q3 Sum
Amazon Price 40 218.45 2544.8692 50.446697 7.9763231 200 200 149 349 198 249 8738

The Distribution of Flipkart prices is also a normal distribution:

The Descriptive Statistics for difference in prices= Amazon-Flipkart:

Column n Mean Variance Std. dev. Std. err. Median Range Min Max Q1 Q3 Sum
Differences 40 -10.85 1445.8744 38.024655 6.0122258 -1 200 -150 50 -40 0.5 -434

The Distribution of differences in Amazon and Flipkart prices too is also normal:

Statistical Analysis:

Confidence Intervals and Hypothesis Results

 With a 95% confidence interval, the lower limit is -23.010875 and an upper limit of
1.3108745 with a standard of error of 6.01225 and a sample mean difference -4.439.
The hypothesis results concluded with a test statistic of -
1.80465, the degrees of freedom is 39 and the p value is 0.0789.

Paired T confidence interval:

D = 1 - 2 : Mean of the difference between Amazon Price and Flipkart Price

95% confidence interval results:

Difference Mean Std. Err. DF L. Limit U. Limit
Amazon Price - Flipkart -10.85 6.012225 39 - 1.3108745
Price 23.010875

Paired T hypothesis test:

D = 1 - 2 : Mean of the difference between Amazon Price and Flipkart Price
H0 : D = 0
HA : D 0

Hypothesis test results:

Difference Mean Std. Err. DF T-Stat P-value
Amazon Price - Flipkart -10.85 6.012225 39 - 0.0789
Price 1.8046561

Graphic Depiction of Data

The following boxplot shows that Flipkart had to higher mean price of
books (229.3) and Amazon had a lower mean (218.45). The maximum price and
range was seen in Flipkarts books. The minimum price of a book is the same across
both websites. Again, Amazon has a lower median price for the books prices on the 2
sites.
Findings:

Based on the results, the p value is is 0.0789, which is

more than 0.05,that tells me that it supports the null hypothesis and that
I can reject the null hypothesis. With 95% confidence, the mean difference between book
prices between Amazon and
Flipkart is between. The finding concludes that my null hypothesis that
there is no difference between the prices of Books on Amazon and Flipkart.

Conclusions:

The conclusions that I can draw from the study is that the 2 websites try to match each
others prices due to their competition, and there will be a change in price whenever a seller
on one of the sites is more eager to sell his book or the book has a limited stock. Based on
mine sample of books, I was able to determine the mean difference between the books on
the 2 websites and determine that Amazon sells its books for a relatively lower price on
average. We learned about the research variable, the books, closely match each other in
prices across Flipkart and Amazon, besides some outliers like The Hitchhikers Guide to the
Galaxy. I learned that the samples truly have to be matched in order to use a 2 sample pair t
test and to avoid any bias, with the exception of the explanation of the seller eager to sell
his books or the limited stock of books. We can finally conclude that there is
no difference between the prices of Books on Amazon and Flipkart.

Source:
Book Amazon Flipkart
Da Vinci
Code 240 249
Fifty Shades
of Grey 249 249
Angels and
Demons 227 230
Twilight 249 220
Harry Potter
and the
Philosopher's
Stone 249 299
The Hound
of The
Baskervilles 249 249
The Invisible
Man 180 199
The
Hitchhiker's
Guide to the
Galaxy 349 499
A Thousand
Splendid
Suns 199 219
The Hunger
Games 249 299
The Book
Thief 249 250
The
Alchemist 220 199
Hannibal 200 249
The Lord of
the Rings 299 299
Boy in the
Striped
Pyjamas 199 250
P.S. I Love
You 199 199
Jane Eyre 149 199
Frankenstein 197 199
Tuesdays
with Morrie 199 249
To Kill a
Mockingbird 149 167
Life of Pi 249 249
Perks of
Being a
Wallflower 200 199
The Fault in
our Stars 239 249
Looking for
Alaska 199 200
Percy
Jackson: The
Lightening
Thief 249 199
The Girl On
the Train 149 199
Divergent 299 250
The Diary Of
A Wimpy Kid 199 199
War And
Peace 349 329
Moby Dick 149 150
The Great
Gatsby 199 149
The
Adventures
of
Huckelberry
Finn 149 150
Pride and
Prejudice 199 199
Lolita 259 299
Alice's
Adventure in
Wonderland 200 249
Great
Expectations 167 147
Anna
Karenina 249 199
Gulliver's
Travels 159 199
David
Copperfield 227 199
Three Men
In a Boat 149 187