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... [Read more...]

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... [Read more...]

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... [Read more...]

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... [Read more...]

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... [Read more...]

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... [Read more...]

"...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... [Read more...]

"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... [Read more...]

A map gives us the big picture, which is why mapping has become so important in marketing research. What is the perceptual structure underlying the European automotive market? All we need is a contingency table with cars as the rows, attributes as the ... [Read more...]

For many of us, factor analysis provides a gateway to learning how to run and interpret nonnegative matrix factorization (NMF). This post will analyze a set of ratings on a 218 item adjective checklist using both principal axis factor analysis and NMF.... [Read more...]

We begin with a data matrix, a set of numbers arrayed so that each row contains information from a different consumer. Marketing research focuses on the consumer, but the columns are permitted more freedom, although they ought to tell us something abou... [Read more...]

As promised in my last post, I am following up with another example of how to perform market segmentations with nonnegative matrix factorization. Included with the R package bayesm is a dataset called Scotch containing the purchase history for 21 brands of whiskey over a one year time period from 2218 respondents. ... [Read more...]

Will you have that segmentation with one or two modes?The data matrix for market segmentation comes to us with two modes, the rows are consumers and the columns are variables. Clustering uses all the columns to transform the two-mode data matrix (row a... [Read more...]

How do you limit your search when looking for a hotel? Those trying to save money begin with price. Members of hotel reward programs focus on their brand. At other times, location is first to narrow our consideration set. What does hotel search re... [Read more...]

Consumer inventories, as the name implies, are tallies of things that consumers buy, use or do. Product inventories, for example, present consumers with rather long lists of all the offerings in a category and ask which or how many or how often they bu... [Read more...]

Purchases are choices from available alternatives. Post-purchase, we know what is the most preferred, but all the other options score the same. Regardless of differences in appeal, all the remaining items received the same score of not chosen. A second... [Read more...]

John Hauser, because no one questions his expertise, is an excellent spokesperson for the viewpoint that consumer preferences are real, as presented in his article "Self-Reflection and Articulated Consumer Preferences." Simply stated, preferences are e... [Read more...]

FactoMineR is a quick and easy R package for generating biplots, such as the following plot showing the columns as arrows with the rows to be added later as points. As you might recall from a previous post, a biplot maps a data matrix by plotting both ... [Read more...]

Something triggers our interest. Possibly it's an ad, a review or just word of mouth. We want to know more about the movie, the device, the software, or the service. Because we come with different preferences and needs, our searches vary in intensity. For some it is one and done, ... [Read more...]

The Internet has freed us from the shackles of the yellow page directory, the trip to the nearby store to learn what is available, and the forced choice among a limited set of alternatives. The consumer is in control of their purchase journey and can t... [Read more...]