Latent class analysis for segmenting preferences of investment bonds

Market segmentation is a key component of conjoint analysis which addresses consumer preference heterogeneity. Members in a segment are assumed to be homogenous in their views and preferences when worthing an item but distinctly heterogenous to members of other segments. Latent class methodology is one of the several conjoint segmentation procedures that overcome the limitations of aggregate analysis and a-priori segmentation. The main benefit of Latent class models is that market segment membership and regression parameters of each derived segment are estimated simultaneously. The Latent class model presented in this paper uses mixtures of multivariate conditional normal distributions to analyze rating data, where the likelihood is maximized using the EM algorithm. The application focuses on customer preferences for investment bonds described by four attributes; currency, coupon rate, redemption term and price. A number of demographic variables are used to generate segments that are accessible and actionable.peer-reviewe

Application of artificial neural network in market segmentation: A review on recent trends

Despite the significance of Artificial Neural Network (ANN) algorithm to market segmentation, there is a need of a comprehensive literature review and a classification system for it towards identification of future trend of market segmentation research. The present work is the first identifiable academic literature review of the application of neural network based techniques to segmentation. Our study has provided an academic database of literature between the periods of 2000-2010 and proposed a classification scheme for the articles. One thousands (1000) articles have been identified, and around 100 relevant selected articles have been subsequently reviewed and classified based on the major focus of each paper. Findings of this study indicated that the research area of ANN based applications are receiving most research attention and self organizing map based applications are second in position to be used in segmentation. The commonly used models for market segmentation are data mining, intelligent system etc. Our analysis furnishes a roadmap to guide future research and aid knowledge accretion and establishment pertaining to the application of ANN based techniques in market segmentation. Thus the present work will significantly contribute to both the industry and academic research in business and marketing as a sustainable valuable knowledge source of market segmentation with the future trend of ANN application in segmentation.Comment: 24 pages, 7 figures,3 Table

Examining the segment retention problem for the “Group Satellite” case

The purpose of this work is to determine how well, criteria designed to help the selection of the adequate number of market segments, perform in recovering small niche segments, in mixture regressions of normal data, with experimental data. The simulation experiment compares several segment retention criteria, including information criteria and classification-based criteria. We also address the impact of distributional misspecification on segment retention criteria success rates. This study shows that Akaike’s Information criterion with penalty factors of 3 and 4, rather than the traditional value of 2, are the best segment retention criteria to use in recovering small niche segments. Although these criteria were designed for the specific context of mixture models, they are rarely applied in the marketing literature.Information criteria; Latent Class Segmentation.

Democracy and Economic Development: a Fuzzy Classification Approach

The aim of this work is to (1) analyse whether countries differ on political indicators (democracy, rule of law, government effectiveness and corruption) and (2) study whether countries with different political profiles are associated with different levels of economic, human development and gender-related development indicators. Using a fuzzy classification approach (fuzzy k-means algorithm), we propose a typology of 124 countries based on 10 political variables. Six segments are identified; these political groups implicate the access to different levels of economic and human development. In this study evidence of a positive but not perfect relationship between democracy and economic and human development is observed, thus presenting new insights for the understanding of the heterogeneity of behaviors relatively to political indicators.Democracy, Economic Development, Fuzzy k-means

Visitor profiling for cable car mountain destinations as a basis for protected area management : a case study of the summer season in the Tatra Mountains at Kasprowy Wierch (Poland) and Skalnaté Pleso (Slovakia)

Protected areas play a crucial role in the conservation of vulnerable mountain ecosystems, but at the same time they may serve as tourist destinations and attract large numbers of visitors. Areas located in close proximity to cable cars belong to some of the most challenging sites for mountain protected area management. This study focuses on two cable car areas: Kasprowy Wierch (Tatra National Park, Poland) and Skalnaté Pleso (Tatra National Park, Slovakia). Both sites belong to the most heavily used leisure destinations in the Tatra Mountains. The study focused on the summer, snow-free tourist peak-season, for which there is an ongoing discussion concerning the development of cable car services. In 2014 and 2015, on-site interviews were conducted in the two study areas (n = 3 304). In order to better understand visitors’ needs and goals, visitor profiling using K-means clustering was performed. Four distinct segments based on visitor motivations were identified: nature oriented (32 %), family / friends & well-being oriented (23 %), sports oriented (14 %), and a mixed segment with multiple motivations (31 %). The results show that two tourist segments were not particularly interested in nature experience, although they visited protected areas. A significant relationship between motivational segments and trip characteristics was identified. The visitor segments defined can be used practically in the management of cable car destinations located within protected areas

Fuzzy Recommendations in Marketing Campaigns

The population in Sweden is growing rapidly due to immigration. In this light, the issue of infrastructure upgrades to provide telecommunication services is of importance. New antennas can be installed at hot spots of user demand, which will require an investment, and/or the clientele expansion can be carried out in a planned manner to promote the exploitation of the infrastructure in the less loaded geographical zones. In this paper, we explore the second alternative. Informally speaking, the term Infrastructure-Stressing describes a user who stays in the zones of high demand, which are prone to produce service failures, if further loaded. We have studied the Infrastructure-Stressing population in the light of their correlation with geo-demographic segments. This is motivated by the fact that specific geo-demographic segments can be targeted via marketing campaigns. Fuzzy logic is applied to create an interface between big data, numeric methods for processing big data and a manager.Comment: conferenc