Research Topics:

Data Analysis | Quantitative Research

Content Type:

Glossary

Confidence Limits Definition

The two values on each end of a confidence interval.

Confidence limits are the range of values within which a population parameter – a mean or proportion, for instance – that is estimated to land. Values outside the confidence interval – the range of values around the sample estimate – are suspect. The limits show the level of uncertainty associated with a sample-based estimate. Confidence limits can prevent marketing professionals from drawing overly confident or misleading conclusions from data. Decisions based on narrow confidence intervals are more reliable because there is a smaller range of potential values for the population parameter. Wider intervals create greater uncertainty.

Who relies on confidence limits?

Marketing professionals, decision makers and researchers rely on confidence limit calculations to make informed conclusions about sample-based research. Businesses seeking to minimize risks associated with marketing strategies and investments also utilize the limits.

Why should I care about confidence limits?

Confidence limits provide insights into the reliability of research findings. They help marketing professionals to gauge how much a sample estimate might deviate from the actual population parameter. The insights can lead to more accurate and confident decisions when interpreting research results and creating marketing strategies.