MKT3421: Marketing Analysis & Decision Making

Lecture Outline
SESSION4 (6-Feb-2015):
Session 4: Consumer Segmentation Analysis I Forming Segments using Cluster Analysis
Intuitive Understanding of Cluster Analysis
Key Terms and Concepts
Procedures for conducting Cluster Analysis
Hierarchical Clustering
K-means Clustering
An Application: Forte Hotel Design (Conjoint) Cluster Analysis
Pre-Session Preparation:
1.

Please read the assigned readings. Optional readings are, well, optional

Readings:
1. Chapter 3, Principles of Marketing Engineering 2nd Edition with particular emphasis on
Segmenting markets (Phase 1) pp. 68-73 and Traditional Segmentation pp. 82-86.
2. ME Case: Forte Hotel Design (Conjoint) also in Session 3.
Optional Reading:
These readings are optional and can be done later without impacting your understanding of the
materials covered in Session 3. These reading materials expand on the lecture content and will not be
tested in the exams. Item 1 provides additional technical details about the materials covered in this
session. If the materials of the Technical Notes appear too complex and confusing at some places, just
skip them! Items 2-3 are applications of Cluster Analysis.
1. TN04 - Segmentation Technical Note pp. 2-17
2. Allen Gibson (2009), Segmenting Business Students Using Cluster Analysis Applied To Student
Satisfaction Survey Results, American Journal of Business Education, Volume 2, Number 4, 6570 (URL: http://journals.cluteonline.com/index.php/AJBE/article/view/4060/4113)
Abstract: Segments B-School students based on their degree of satisfaction with the program
3. Aswin Sangpikul (2008), A factor-cluster analysis of tourist motivations: A case of U.S. senior
travelers,
Original
Scientific
Paper,
Vol.
56,
No
1,
23-40
(URL:
http://www.google.com.sg/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=3&ved=0CEM
QFjAC&url=http%3A%2F%2Fhrcak.srce.hr%2Ffile%2F57524&ei=4rUPUdHMBo6PrgeLu4DIA
Q&usg=AFQjCNH0yN6xIYQhSxbSA5UfcASqwc5hOw)
Abstract: The U.S. senior travel market is one of the important senior segments for Thailand's
tourism industry. However, little knowledge is known regarding this segment, particularly its
travel related-behavior and motivations to visit Thailand. The purpose of this study is to
investigate travel motivations of U.S. senior travelers to Thailand by adopting the theory of push
and pull motivations as a conceptual framework. This study also examines the possibility of
segmenting the U.S. senior travel market by utilizing attribute-based benefits segmentation (pull
motivational factors). The results of factor analysis identify three push and four pull factor
dimensions. Among them, 'novelty & knowledge-seeking' and 'cultural & historical attractions' are
viewed as the most important push and pull factors, respectively. Based on cluster analysis, the
study reveals two distinct segments within the U.S. senior travel market (i.e. 'cultural & historical
seekers' and 'holiday & leisure seekers'). The results of the study provide important implications
for both policy makers and industry practitioners to develop effective marketing strategies for each
segment.