CLUSTER

ANALYSIS GRP
1

PROBLEM STATEMENT
Stimulus:

Marketers use demographic variables such as age, gender and education to identify distinctive segments that they
can attract, retain and win loyalty. But at often instances they fail to provide any useful insights which might be helpful for sound
decision making. Bencare wants to move away from simplistic segmentation strategies to those that use variables that consumers
actually use in making choice decisions for insurance products.
The KCPs of interest are defined as follows:

DESCRIPTION OF SEGMENTS
Well be considering four dependent variables for external validation

Satisfaction:

Trust Company:
Trust Agent:
Behavioural Loyalty:
Cognitive Loyalty:

Pricing:
Reputation:

SAT1 to SAT3

PRICE1 to PRICE3
REPU1 to REPU4

Short-term Value:

VAL1 to VAL3

Long-term Value:

VAL4 to VAL6

rep17 to rep 20
prac17 to prac20
loy1 to loy4
loy5 to loy8

The segmentation is based on the customer perception about Bencare on

a scale of Satisfaction, pricing, reputation, and short/long term values. The
segments will display Trust or Loyalty depending upon the loadings on the
corresponding attributes.

The aim of Bencare is to go beyond the conventional measures and derive insights from the segments in terms of the loyalty factor
and to identify the most appropriate segment to target. It also aims to study the impact of cultural differences on loyalty.

OBJECTIVES
To identify different customer segments using Insurance Products
To analyse groups of similar data instead of individual observation.
Analyse the loyalty of different segments
Studying the impact of cultural differences on each particular segment.

ANALYTICAL PLAN
Prepping the data by
removing the outliers

Identifying the cluster

seeds using
Hierarchical
Clustering

Identify the cluster

centroids by
comparing the means
using ANOVA

Split the dataset into

two halves, a test
sample and other is
the internal validation
sample and apply KMeans cluster to
obtain new centroids

Run External Validation using

ANOVA to compute differences
between the means within
each sample

Run Cohens Kappa to

determine symmetry or
agreement within the
cluster seeds.

Run Update and No

Update to obtain Cluster
Membership

ASSUMPTIONS
1

Well be using compositional method as assessment of similarity in which a

defined set of attributes is considered in developing the similarity between
objects

Were using Squared Euclidean distance as it increases the importance of large

distances, while weakening the importance of small distances.

The dataset provided is free from any Multicollinearity biases as the factors
scores have been provided in the dataset

We would be considering that all dependent variables are correlated with each
other and thus behave similarly, so checking outliers for any one would suffice

Step 1: Identifying Outliers

We will be using Mahalonobiss distance for Multivariate Normality using
Regression.
Were considering 99% significance at a five degrees of freedom, the ChiSquare value for which is 15.086, so any value of Mahals distance
exceeding this cut-off will be treated as an outlier.
There are a total of 29 outliers, which represent around 3.6 % of the total
responses.
As were eliminating these outliers we can see the variance captured
increases from 38.1% to 56.5%, which reflects a clear case of the
presence of outliers, hence we
will eliminate all those 29 outliers.

Step 2 : Cluster Seeds using

Hierarchical Clustering
Theres a significant increase in the percentage
change as we move from cluster 4 to 3. Cluster
Seed=3 would be the most appropriate choice.

% Change
It graph is a visual representation of the % age change for
deciding upon the number of cluster seeds. The first elbow
appears at 4, thus Number of Cluster Seeds deduced is 3. We
would be running hierarchical clustering for clusters 3 to 7.

15
10
Stress

5
0
2

9 10 11 12 13 14 15

Number of Clusters

Estimating Cluster Centroids using

ANOVA (For Cluster Seed 3)
Step 3 :

Descriptive

REGR factor score 1 for

analysis 1

REGR factor score 2 for

analysis 1

REGR factor score 3 for

analysis 1

N
1
2
3
Total
1

247
144
677

2
3
Total
1

247
144
677

2
3

247

Total
REGR factor score 4 for
analysis 1

REGR factor score 5 for

analysis 1

286

286

286

144
677
286

2
3
Total
1

247
144
677

2
3

247

Total

677

286

144

Std.
Mean
Deviation
-.524475
.87593233
8
.2247202 .55471251
.8042042 .61893394
.0314789 .88774481
-.145388
.65155437
4
.0531066 1.06215779
.3734897 .76418553
.0373985 .86680447
-.102392
.97457065
4
.1551692 .67344599
-.121879
1.05996505
4
-.012567
.90519522
3
-.395874
.77777667
9
.4470345 .61640115
.1610676 .82835820
.0301197 .82607392
-.190584
.76591607
3
.7239336 .69727932
-.802032
.85476796
5
.0130160 .96047909

Mean value of
standardized
scores to be
used as the
centroids
for
cluster
Analysis.

Looking at F value
we can say that
factor 1 and
factor 5
contributes
maximum in the
formation of this
clusters.

Sum of
Squares

REGR
factor
score 1
for
analysis 1

Between
Groups
Within
Groups
Total

REGR
factor
score 2
for
analysis 1

Between
Groups
Within
Groups
Total

REGR
factor
score 3
for
analysis 1

Between
Groups
Within
Groups
Total

REGR
factor
score 4
for
analysis 1

Between
Groups
Within
Groups
Total

REGR
factor
score 5
for
analysis 1

Between
Groups
Within
Groups
Total

Sig. = .000 for

all
the
five
factors.
It
shows
that
means
are
significantly
different

Mean
Square

df

183.605

349.144

674

532.749

676

25.882

482.030

674

507.913

676

10.978

542.922

674

553.900

676

97.303

363.998

674

461.301

676

232.350

391.273

674

623.624

676

91.803

Sig.

177.219

.000

.518

12.941

18.095

.000

.715

5.489

6.814

.001

.806

48.652

90.086

.000

.540

116.175

200.121

.000

.581

Step 3 : Estimating Cluster Centroids

using ANOVA(Cluster seed 4 and 5)
4

ANOVA

Sum of
Sig.
Squares
0.000
45.366

Sum of Squares
36.093
162.691

196

153.419

195

Total
REGR factor score Between Groups
2 for analysis 1
Within Groups

198.784
79.696

199
3

199
4

0.000

198.784
87.322

119.091
198.787
51.365

196
199
3

0.000

111.465
198.787
66.102

195
199
4

141.417
192.782
71.877

196
199
3

0.000

126.680
192.782
78.983

195
199
4

120.777
192.654
102.854

196
199
3

0.000

113.671
192.654
107.661

195
199
4

67.280
170.134

196
199

62.473
170.134

195
199

Total
REGR factor score Between Groups
4 for analysis 1
Within Groups
Total
REGR factor score Between Groups
5 for analysis 1
Within Groups
Total

F
14.494

43.721

23.730

38.881

99.878

Cluster size 4 :Mean significantly different. Factor 2

and factor 5 are contributing most towards the
formation of this cluster. As these are having the
highest F value.

df

REGR factor score Between Groups

1 for analysis 1
Within Groups

Total
REGR factor score Between Groups
3 for analysis 1
Within Groups

df

F
14.415

Sig.
0.000

38.191

0.000

25.438

0.000

33.873

0.000

84.012

0.000

Cluster
size
5;
Mean significantly
different. Factor 2
and factor 5 are
contributing most
towards
the
formation of this
cluster. As these
are having the
highest F value.

Step 3 : Estimating Cluster Centroids

using ANOVA (Cluster Seeds 6 & 7)
6

ANOVA

REGR factor
score 1 for
analysis 1
REGR factor
score 2 for
analysis 1
REGR factor
score 3 for
analysis 1
REGR factor
score 4 for
analysis 1
REGR factor
score 5 for
analysis 1

Sum of
Squares
Between
Groups
Within Groups
Total
Between
Groups
Within Groups
Total
Between
Groups
Within Groups
Total
Between
Groups
Within Groups
Total
Between
Groups
Within Groups
Total

49.813

df

F
5

Sig.

12.974

0.000

Sum of
Squares
51.595

df

7
F

Sig.

11.276

0.000

148.972

194

147.189

193

198.784

199

198.784

199

88.940
109.847
198.787
82.595
110.188
192.782
91.248
101.406
192.654
112.896
57.238
170.134

31.415

194
199
5

29.084

194
199
5

194
199

0.000

34.913

105.472
87.310
192.782

0.000

76.529

96.449
102.338
198.787

194
199
5

0.000

95.319
97.335
192.654

0.000

Cluster size 6; Mean significantly different. Factor 4 and

factor 5 are contributing most towards the formation of
this cluster. As these are having the highest F value.

113.983
56.151
170.134

30.316

193
199
6

38.858

193
199
6

193
199

0.000

31.501

193
199
6

0.000

0.000

65.297

0.000

Cluster size 7;
Mean significantly
different. Factor 3
and factor 5 are
contributing most
towards
the
formation of this
cluster. As these
are having the
highest F value.

Step 4: K mean Clustering

We Are using K Mean clustering for fine tuning of the result which we have got from hierarchical
clustering.
We are dividing the total sample into two equal parts using random no. and then performing
K mean cluster analysis on the first half.
Using the result of first half we are calculating centroid value for update and no update
clustering method.
Then we using these centroid to cluster the remaining half of the randomly divided data.
Then we used cross tab to calculate Kappa for each cluster and will choose the no. of cluster
with highest kappa value

Cluster Centre for First Half

Initial clusters center derived hierarchical cluster were fine tuned using k Mean
for further use in second half of the data.
As from the f value for different cluster it can be seen that the factor score in
each cluster is sufficiently different in each cluster and difference in factor score
lead to formation of clusters
Also difference in factor scores having the most impact on the formation of the
cluster for example differences in factor 5 is more responsible for formation of 3
clusters.
Distance in factor score for 5th factor has more impact in formation of 4, 5, 6 and
7 clusters

Cluster Centre for Second Half

The process is run twice; once in a
constrained manner (with no update
option) and then in an unconstrained
manner (with update option).
As from the f value for different cluster it
can be seen that the factor score in each
cluster is sufficiently different in each
cluster and difference in factor score lead
to formation of clusters
From the kappa value of cross tab results it
can be seen that 3 cluster solution is given
the highest agreement between the update
and no update solution. Further there is
another spike at 6 clusters.

Cluster Centre for Second Half

Final Solution with 3 clusters

From the factor analysis it can be seen that
Factor 1
Satisfaction
Factor 2

Prices

Factor 3

Reputation

Factor 4

Short term value

Factor 5

Long term value

Final centroid value have been calculated using the

centroid of the from the first half as initial values
As from the anova table it can be seen that F value for
the Long Term Value and Short Term Value are the
highest so the difference between the cluster is highly
dependent upon the Long Term Value and then on Short
Term Value and Prices.

Chart Title

Final Solution with 3 clusters

Segments
Cluster 1 :- This segment customers have rated
bencare negatively on all the parameter and
Bencare might not be able to convert them to their
customer
Cluster 2 :- This segment has high value for Long
Term Value, but reputation and Satisfaction of
Bencare are on the border line. Program targeting
to improve reputation and satisfaction should be
under taken.
Cluster 3:- This segment customers have rated
bencare positively on Reputation and Short Term
Values, however it depresses tremendously for
Long Term Value, even Satisfaction and Prices are
on borderline.

.80000
.60000
.40000
.20000
.00000
Satisfac tion

Pric es

Reputation

Short Term Value

-.20000
-.40000
-.60000
-.80000
-1.00000
-1.20000
1

Long Term Value

STEP 5: EXTERNAL VALIDATION

We conducted Factor Analysis for the remaining

variables and calculated Factor scores for those
dependent variables. As seen in the table, F Value for all
the factors is high and are significant, hence they have
different means for different clusters.
1.5000000

1.0000000

.5000000

Trust_Agent

Centroids
.0000000

BEH_Loy
1

TRUST_COM APNY
COG_LOY

-.5000000

-1.0000000

Clusters

Trust Agent, Behavioural Loyalty and Cognitive Loyalty

display similar behaviour for different clusters, whereas
Trust Company is displaying an entirely opposite behaviour
for the clusters.
For Cluster 1, all attributes display a negative correlation
except Trust Company.

Impact of Culture: Location

We split the data file with respect to location
into three part and then ran our cluster analysis
keeping no. of cluster equal to 3.
As from the f value it can be seen that in
different factors in different region have
maximum difference and are affecting the
formation of clusters
Reputation for USA is the main difference
creator and prices have the least impact.
For Germany long term value is the major
difference creator. Reputation and
satisfaction value has least impact.
For Holland long term value and reputation
are the main difference creator and
satisfaction has least impact.

Final Cluster Centers

Cluster
LOCATION
1
2
3
USA
Satisfaction
.
-.15361 .69851
29420
Prices
-.2647
.30614 .26260
1
Reputation
1.215 .53936 .45450
16
Short Term -.7506
.08614 .38040
Value
5
Long Term
.
.37496 -1.35467
Value
05212
Germany Satisfaction -.6023
.24623 .07035
5
Prices
-.4241
.37137 -.25292
4
Reputation
.
-.09780 -.22754
59298
Short Term -.5681
.39318 .53533
Value
7
Long Term
.
.84704 -.84574
Value
36304
Holland Satisfaction -.1140
-.13998 .02959
2
Prices
-.3057
.13363 .02322
5
Reputation -.7703
-.06331 .76256
5

ANOVA
LOCATION
F
USA
Satisfactio
12.054
n
Prices
8.833
Reputation 106.50
8
Short Term
32.763
Value
Long Term
86.276
Value
Germany Satisfactio
20.103
n
Prices
24.409
Reputation 20.352
Short Term
53.310
Value
Long Term 219.50
Value
0
Holland
Satisfactio
1.038
n
Prices
5.213
Reputation 78.191
Short Term
39.038
Value
Long Term 107.58
Value
7

Sig.
.000
.000
.000
.000
.000
.000
.000
.000
.000
.000
.356
.006
.000
.000
.000

.50000
.40000
.30000
.20000
.10000
.00000

Impact of Culture: Location

-.10000

-.20000
-.30000
-.40000
-.50000
USA prices

2.00000

USA and Holland have similar perception

about prices as compared to Holland in
various segments.
USA and Germany show similar satisfaction
for Bencare product across various segment .
In USA and Germany customer see long term
of Bencare product in same light across
various clusters except cluster 2.
In Germany reputation of Bencare is near
border line for cluster 2 and can be
improved.
For Holland reputation of bencare for cluster
2 is at the borderline and should be improved
In Germany Prices of bencare for cluster 3 is
at the borderline and should be improved
upon.

Holland Prices

1.50000

1.00000
.00000

Germany Prices

1.00000
1

0.50000
0.00000

-1.00000

-0.50000

-2.00000

-1.00000

-3.00000

-1.50000

-4.00000

-2.00000
USA LTV

Germany LTV

USA Reputation

Holland LTV

Germany Reputation

Holland Reputation
.80000
.60000

1.00000

.40000

.50000

.20000
.00000
-.20000

-.40000

.00000
1
-.50000

-1.00000

-.60000

-1.50000

-.80000
-1.00000
USA STV

Germany STV

Holland STV

usa statisfaction
Holland Satisfaction

germany satisfaction

Impact of Culture : Gender

We split the data file with respect to
location into three part and then ran
our cluster analysis keeping no. of
cluster equal to 3.
As from the f value it can be seen that
in different factors in different region
have maximum difference and are
affecting the formation of clusters
Long Term Value and Reputation for
Males are the main difference
creator and Satisfaction and Prices
have the least impact.
For Females long term value is the
major difference creator.
Satisfaction has least impact.

Reputation
0.80000
0.60000
0.40000
0.20000
0.00000
1
-0.20000
-0.40000
-0.60000
-0.80000
-1.00000
-1.20000

Impact of Gender
Prices

Short Term Value

.40000
.20000

Males and Females are similarly

receptive towards price, short term
and long term value as attributes
Females in Cluster 1 and Cluster 3
give more importance to
Satisfaction, whereas for Cluster 2
its near zero, which can be
improved upon. Males have
lukewarm response in Cluster 2
and 1.
In case of Reputation Males and
Females in Cluster 1 and Cluster 2
show opposite preferences.
Reputation of Bencare Move in
opposite direction for Male and
female in different segment

.00000
-.20000

.60000
1

.40000
3

.00000

-.60000

2 Female
1

-.20000

-.80000
1 M ale

2 Female

Satisfaction

-.40000
-.60000
-.80000

.50000
.40000

Long Term Value

1.00000

.30000

.50000

.20000

.00000

.10000
-.10000

1 M ale

.20000

-.40000

.00000

1 M ale
2 Female

-.50000
1

3-1.00000

-1.50000

-.20000
1 M ale

2 Female

2
1 M ale
2 Female

Impact of Culture : Age

We split the data file with respect to Age into Five
part and then ran our cluster analysis keeping no. of
cluster equal to 3.
As from the f value it can be seen that in different
factors in different Age groups have maximum
difference and are affecting the formation of clusters
For 18-24 yrs , No attribute is showing significant
impact. Except Satisfaction and reputation
For 25-34 yrs , Long term value shows maximum
difference and maximum impact.
For 35-44 yrs , Long term value and satisfaction
shows maximum difference and maximum impact.
For 45-54 yrs , Long term value shows maximum
difference and maximum impact.
For 55+ yrs , Long term value shows maximum
difference and maximum impact.

Satisfaction
1.00000
0.00000
1
-1.00000
-2.00000
-3.00000
-4.00000

Impact of Culture : Age

For Age group 35-44yrs, All
attribute are negatively rate or
slightly positive
For age group 18-24 yrs, all
segment see Long term value in
Bencare Products but are highly
dissatisfied. Even believe that
prices are on higher side.
Satisfaction level for age group
55+ yrs is negative or on the
borderline
For long term value all clusters
have rate similarly except age
18-24 yrs

18-24 yrs

25-34 yrs

45-54 yrs

55+ yrs

35-44 yrs

Pricing

Shot term Value

1.00000

1.50000
1.00000
0.50000
0.00000
1
-0.50000
-1.00000
-1.50000

.50000
2

.00000

-.50000
18-24 yrs

25-34 yrs

45-54 yrs

55+ yrs

35-44 yrs

Long term Value

1.00000
2

-2.00000
18-24 yrs

25-34 yrs

45-54 yrs

55+ yrs

25-34 yrs

45-54 yrs

55+ yrs

35-44 yrs

Reputation

2.00000
.00000
1
-1.00000

18-24 yrs

35-44 yrs

2.50000
2.00000
1.50000
1.00000
.50000
.00000
1
-.50000
-1.00000

18-24 yrs

25-34 yrs

45-54 yrs

55+ yrs

35-44 yrs

1.50000
1.00000
0.50000

Solution with 6 Cluster

0.00000
Satisfaction

Pricing

Reputation

Short term Value Long term Valu

-0.50000
-1.00000

As their was spike in Kappa value at 6 cluster so K mean

cluster analysis was done with 6 cluster and initial seed
value from k mean second half was used.
From f value, it can be seen that satisfaction, pricing
and longterm value play similar role in determination
of segments which is different from 3 cluster as
satisfaction has least role to play.

Similar to 3 cluster there is one cluster which has all

the values negative (cluster 1) and also there is one
cluster which has all value positive (cluster 3) apart
from them other cluster have mixed perception

Cluster 6 has only long term value negative while

cluster 4 has only satisfaction positive.

-1.50000
-2.00000
1

Managerial Implication
Product with long term value should be provided to Cluster 3 customer as they high
reputation for Bencare and are also loyal but feel that prices are on the higher side
As for Cluster 2 reputation of Bencare in on the border line. So Program targeting to
improve reputation should be under taken.
USA market should be targeted using method which build reputation of the company as
reputation is the main difference creator.
Similarly for Germany long-term value are major difference creator these attribute
should be emphasized upon.
For customer in Holland Long term value and reputation both are major difference
creator.
For Cluster one, trust in company is an important attribute which should be emphasized
Reputation of Bencare in Holland and Germany are on the borderline, measure such as
improvement of services and customer should be under taken to improve the reputation of
the company

Managerial Implication
USA and Germany show similar satisfaction for Bencare product across various segment

Males and Females are similar perception towards price, short term and long term value as attributes for Bencare Product.

Reputation for Bencare is totally opposite for Male and female in different segments

Female of the two segment are satisfied with Bencare product and second clusters for female is on the borderline which
can be improved upon.
For age group 18-24 yrs, all segment see Long term value in Bencare Products but are highly dissatisfied. Even believe that prices are on
higher side.
Reputation of Bencare product move in similar fashion across various age groups except for 18-24 yrs age group which show
increased reputation in cluster 3.
Cluster 6 has only long term value negative while cluster 4 has only satisfaction positive which so cluster 6 should be provided with product with
long term value and cluster 4 are loyal customer as they have high satisfaction instead of all other parameter being negative.

RECOMMENDATIONS
1

Cluster 2 and Cluster 3 display high loadings on Loyalty, thus they should be the favoured customers.

Cluster 1 customers fall in the bad customer category, those who cant be gained back even by any means, whereas segment 2 customers
have rated Bencare consistently except Reputation, which can worked upon.

Cluster 3 seems to be the most attractive segment as they reflect negatively on Satisfaction and Price parameters, they also are looking
for products which have long term value.

Similar promotion and product strategy could be used for USA and Germany as customer show similar preference for various attribute for
Bencare product.

Age group of 18-24 yrs should be target as they perceive high long term value for Bencare but are not satisfied. And prices seems to be
the problem that lead to their dissatisfaction. So product emphasizing long term value with appropriate prices should be introduced.

Satisfaction improvement plan such customer care and support upgradation should be under taken

Pricing for two age group are perceived high so a new product mix should be adopted to cater the need of various age group for example
18-24 age group require low cost product.

Appendix:- Syntax

CLUSTER FAC1_1 FAC2_1 FAC3_1 FAC4_1 FAC5_1

/METHOD WARD
/MEASURE=SEUCLID
/PRINT SCHEDULE CLUSTER(3,7)
/PLOT NONE
/SAVE CLUSTER(3,7).

ONEWAY FAC1_1 FAC2_1 FAC3_1 FAC4_1 FAC5_1 BY CLU3_1

/STATISTICS DESCRIPTIVES
/MISSING ANALYSIS.

REGRESSION

/MISSING LISTWISE
/STATISTICS COEFF OUTS R ANOVA
/CRITERIA=PIN(.05) POUT(.10)
/NOORIGIN
/DEPENDENT behloy1
/METHOD=ENTER FAC1_1 FAC2_1 FAC3_1 FAC4_1 FAC5_1
/SAVE MAHAL.

/TABLES=QCL3_1 BY QCL3_2
/FORMAT=AVALUE TABLES
/STATISTICS=KAPPA
/CELLS=COUNT EXPECTED
/COUNT ROUND CELL. DATASET ACTIVATE DataSet1.

DATASET ACTIVATE DataSet2.

CROSSTABS

DATASET ACTIVATE DataSet2.

ONEWAY FAC1_1 FAC2_1 FAC3_1 FAC4_1 FAC5_1 BY CLU4_1
/STATISTICS DESCRIPTIVES
/MISSING ANALYSIS.

AGGREGATE

/OUTFILE='C:\Users\pardita\Desktop\MA\cluster
analysis\new\CLUSTER3.sav'
/BREAK=CLU3_1
/Factor1=MEAN(FAC1_1)
/Factor2=MEAN(FAC2_1)
/Factor3=MEAN(FAC3_1)
/Factor4=MEAN(FAC4_1)
/Factor5=MEAN(FAC5_1).

Appendix:- Syntax

COMPUTE randnum = RV.UNIFORM(0,1) .

EXECUTE .
SORT CASES BY randnum (A) .
RECODE randnum
(Lowest thru .5=1) (.5 thru Highest=2) INTO half .
EXECUTE .
SORT CASES BY half .
SPLIT FILE
SEPARATE BY half.

SELECT IF (Half=2).
QUICK CLUSTER FAC1_1 FAC2_1 FAC3_1 FAC4_1 FAC5_1
/MISSING=LISTWISE
/CRITERIA=CLUSTER(3) MXITER(10) CONVERGE(0)
/METHOD=KMEANS(UPDATE)
/PRINT INITIAL ANOVA
/INITIAL = (-.52448
-.14539 -.10239 -.39587 -.19058
.22472 .05311 .15517 .44703 .72393
.80420 .37349 -.12188 .16107 -.80203)
/OUTFILE='C:\Users\pardita\Desktop\MA\cluster
analysis\new\Split2Cluster3.sav

TEMPORARY.

TEMPORARY.

SELECT IF (Half=1).
QUICK CLUSTER FAC1_1 FAC2_1 FAC3_1 FAC4_1 FAC5_1
/MISSING=LISTWISE
/CRITERIA=CLUSTER(3) MXITER(10) CONVERGE(0)
/METHOD=KMEANS(UPDATE)
/SAVE CLUSTER
/PRINT INITIAL ANOVA
/INITIAL= (-.47056 -.41682 -.53086 -.53407 -.37517
.02075 .01822 .27613 .35044 .87636
.56811 .54855 .11225 .30771 -.83024)
/OUTFILE='C:\Users\pardita\Desktop\MA\cluster analysis\new\SPLIT1CLUSTER3A.sav'.

FACTOR

/VARIABLES rep17 rep18 rep19 rep20 prac17 prac18 prac19 prac20 loy1 loy2 loy3 loy4 loy5 loy6 loy7
loy8
/MISSING LISTWISE
/ANALYSIS rep17 rep18 rep19 rep20 prac17 prac18 prac19 prac20 loy1 loy2 loy3 loy4 loy5 loy6 loy7
loy8
/PRINT INITIAL EXTRACTION ROTATION
/FORMAT BLANK(.20)
/CRITERIA FACTORS(4) ITERATE(25)
/EXTRACTION ML
/CRITERIA ITERATE(25) DELTA(0)
/ROTATION OBLIMIN
/SAVE REG(ALL).

Thank You!!!

ANALYTICAL STEP

Problem and Analytical Plan

Segmentation Challenge & Strategy
Factors for Differentiating Segments
Factors for Describing Segments
Factors to Validate Segments
Outline Analytical Plan
Detail Steps
Evaluation Criteria to be Used
Expected Results

MAX POINTS

YOUR POINTS REMARKS/FEEDBACK

1.5

Excellent presentation, organization and layout. Emphasis on

cultural differences done well.
Correct factors chosen for differentiation and validation.
Segments are not described in terms of relevant factors, but are
executed and discussed in detail (and correctly) when doing
cultural differences.
Detailed step-wise analytical plan given. No indication of
evaluation criterion or expected results at each stage of the plan,
but executed correctly.

Distinctiveness

Distinctive feature of problem and analytical plan distinctive

Analytics Execution and Reporting

Scales, Outliers, Multicollinearity, & Factor Scores

0.5

Correctness & Rigor of Procedures

Cluster Model Selection and Validation

Quality of Tabulated & Ploted Evidence

Interpretation Quality and Precision

Cultural differences attempted in detail and with thoughtful

development. Assumptions on slide 4 are not appropriate either
as stated; for instance, the first assumption is better written as
Compositional Approach to Identify Clusters Based on Predetermined Attributes/Factors

See notes in last draft re inaccurate interpretation of R-square as

indication of outliers (it is not); Removal of so many outliers may
not be warranted.
The sequencing of steps is correct. The rigour in the process is
not reflected by the PPT as vital steps and outputs of the process
are shortened. E.g. the entire K-means procedure examining 5
cluster options get covered in only 5 slides.
Selecting and testing a 3-7 clusters range of is a good choice, and
the procedure is executed correctly.
Incomplete tabulated evidence in many cases, e.g. K-means
procedure. K-means clustering with second split half not
presented well in the ppt.
The 3 clusters are not labelled. They are not described in terms of
either segmentation or demographic variables.Cultural
differences are discussed well.