A comparative analysis of alternative segmentation methodologies

Date of publication: September 1, 1989

Abstract:

Using behavioral data, two alternative segmentation methodologies, regression and cluster analysis, were compared on the basis of rigor, reliability, parsimony, interpretability and strategic implications for retailers. Regression analysis is the preferred methodology on all comparative performance measures. In addition, both psychographic and demographic descriptor variables make substantial contributions to the analysis of consumer shopping activities across retailers. Finally, the analysis reported here demonstrates high levels of cross-shopping, both within and across competitive retail sectors. The overall results lead to important strategic and tactical implications for apparel retailers.

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