Multivariate Research

Market Segmentation Analysis

Most marketers would agree with the notion that not all consumers are alike and understanding the psychographic and behavioral differences between potential buyers enables more targeted and successful marketing strategies.

Segmenting the market using a cluster analysis technique can help uncover the underlying structure of the marketplace. However, traditional cluster analysis routines are often unproductive. The problem with conventional clustering techniques is that they will always produce market segments whether the results are meaningful or not. The important question is are these segments reliable, are the results reproducible? Unfortunately, the answer is often "no".

TSG uses a clustering methodology that vastly improves the accuracy and reliability of market segmentation results. "Convergent Cluster Analysis" (CCA), developed by Sawtooth Software, is a revolutionary method for segmenting the market. Rather than solving for simply one clustering solution, convergent cluster analysis , through an iterative process, generates multiple clustering solutions, comparing each replication to every other previous one, evaluating its reproducibility. The analysis is concluded when the most reproducible solution has been found from all those generated. The technique delivers results vastly superior to conventional clustering methodologies.

Using CCA, our clients develop strategic plans with greater confidence from marketing insights that give them a competitive advantage.

Cluster Analysis - example