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Part two of a two-part series on market segmentation
Researchers typically focus on the cluster analysis component of market segmentation. However, for segmentation to be successful, one must follow all of the steps of the analytic process, which include: 1) clustering, 2) statistically testing the clusters, and 3) profiling the clusters to determine if they satisfy the segmentation objectives. In this paper, Actionable Market Segmentation Guaranteed – Part Two, the most frequently proposed clustering procedures will be detailed, as will the methods of statistically evaluating the clusters and profiling the clusters. The pros and cons of various clustering techniques will also be discussed in the context of identifying actionable segments.
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