The Handbook of Marketing Research: Uses, Misuses, and Future Advances comprehensively explores the approaches for delivering market insights for fact-based decision making in a market-oriented firm. Divided into four parts, the Handbook addresses (1) the different nuances of delivering insights; (2) quantitative, qualitative, and online data gathering techniques; (3) basic and advanced data analysis methods; and (4) the substantial marketing issues that clients are interested in resolving through marketing research.

Cluster Analysis and Factor Analysis

Cluster analysis and factor analysis

Consider the following situations:

  • The marketing manager of a large financial institution is interested in developing portfolios of product offerings that would appeal to various market segments.
  • The manager of a large telecommunication company is interested in developing and managing a portfolio of customers that would generate substantial profits over their lifetime.
  • The store manager is interesting in identifying the optimal mix of products demanded by its customers.

In each of the above scenarios, the manager's objective is to group stimuli (e.g., product offerings, customers, and mutual funds) into groups such that stimuli in each group are similar, and stimuli in each group are different from stimuli in other groups. Cluster analysis is one of the techniques in the manager's ...

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