Blog Archives

Combating Multicollinearity by Asking the Right Questions and Uncovering Latent Features

October 26, 2014
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Combating Multicollinearity  by Asking the Right Questions and Uncovering Latent Features

Overview. When responding to questions about brand perceptions or product feature satisfaction, consumers construct a rating  by relying on their overall satisfaction with the brand or product plus some general category knowledge of how diffi...

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Modeling Plenitude and Speciation by Jointly Segmenting Consumers and their Preferences

October 21, 2014
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Modeling Plenitude and Speciation by Jointly Segmenting Consumers and their Preferences

In 1993, when music was sold in retail stores, it may have been informative to ask about preference across a handful of music genre. Today, now that the consumer has seized control and the music industry has responded, the market has exploded into more...

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Beware Graphical Networks from Rating Scales without Concrete Referents

October 15, 2014
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Beware Graphical Networks from Rating Scales without Concrete Referents

We think of latent variables as hidden causes for the correlations among observed measures and rely on factor analysis to reveal the underlying structure. In a previous post, I borrowed an alternative metaphor from the R package qgraph and produce...

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Consumer Preference Driven by Benefits and Affordances, Yet Management Sees Only Products and Features

October 3, 2014
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Consumer Preference Driven by Benefits and Affordances, Yet Management Sees Only Products and Features

Return on Investment (ROI) is management's bottom line. Consequently, everything must be separated and assigned a row with associated costs and profits. Will we make more by adding another product to our line? Will we lose sales by limiting the feature...

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TURF Analysis: A Bad Answer to the Wrong Question

September 29, 2014
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TURF Analysis: A Bad Answer to the Wrong Question

Now that R has a package performing Total Unduplicated Reach and Frequency (TURF) Analysis, it might be a good time to issue a warning to all R users. DON'T DO IT!The technique itself is straight out of media buying from the 1950s. Given some number of...

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Recognizing Patterns in the Purchase Process by Following the Pathways Marked By Others

September 28, 2014
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Recognizing Patterns in the Purchase Process by Following the Pathways Marked By Others

Herbert Simon's "ant on the beach" does not search for food in a straight line because the environment is not uniform with pebbles, pools and rough terrain. At least the ant's decision making is confined to the 3-dimensional space defining the beach. C...

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What is Cluster Analysis? A Projective Test

September 22, 2014
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What is Cluster Analysis? A Projective Test

Supposedly, projective tests (e.g., the inkblots of psychoanalysis) contain sufficient ambiguity that "what you see" reveals some aspect of your thinking that has escaped your awareness. Although the following will provide no insight into your neurotic...

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The New Consumer Requires an Updated Market Segmentation

September 18, 2014
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The New Consumer Requires an Updated Market Segmentation

The new consumer is the old consumer with more options and fewer prohibitions. Douglas Holt calls it the postmodern market defined by differentiation: "consumer identities are being fragmented, proliferated, recombined, and turned into salabl...

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The Ecology of Data Matrices: A Metaphor for Simultaneous Clustering

September 13, 2014
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The Ecology of Data Matrices: A Metaphor for Simultaneous Clustering

"...a metaphor is an affair between a predicate with a past and an object that yields while protesting." Nelson Goodman (1976)It is, as if, data matrices were alive. The rows are species, and the columns are habitats. At least that seems to be the...

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Attention Is Preference: A Foundation Derived from Brand Involvement Segmentation

September 1, 2014
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Attention Is Preference: A Foundation Derived from Brand Involvement Segmentation

"A wealth of information creates a poverty of attention."Herbert SimonWe categorize our world so that we can ignore most of it. In order to see figure, everything else must become ground. Once learned, the process seems automatic, and we forget how har...

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