Multidimensional Scaling for Product Positioning
Multidimensional scaling (MDS) is a series of statistical techniques used for identifying the key dimensions underlying respondents’ evaluations of objects and keeping them in multidimensional space. MDS is widely used in marketing research for positionin
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Multidimensional Scaling for Product Positioning
Learning Objectives After completing this chapter, you should be able to do the following: • • • •
Know the use of multidimensional scaling in market research. Understand the different terms used in multidimensional scaling. Learn the procedures used in multidimensional scaling. Able to identify the research situations where multidimensional scaling can be used. • Describe the SPSS procedure involved in multidimensional scaling. • Explain the various outputs generated by the SPSS in this analysis.
Introduction Multidimensional scaling (MDS) is a series of statistical techniques used for identifying the key dimensions underlying respondents’ evaluations of objects and keeping them in multidimensional space. MDS is widely used in marketing research for positioning of brands. It would be desired for any company to know as to how its brand of products is rated among other similar competing brands. While assessing the brand image of any product, the respondents may rate it on the basis of its overall image or on the basis of certain attributes. Thus, besides knowing the relative positioning of the products, one may like to know the strength of the product in comparison to other similar products on different dimensions. The MDS can be used to solve varieties of problems in management research. For example, it finds application in market segmentation, product life cycle, vendor evaluation, and advertising media selection. Though it is possible to use MDS with quantitative variables (i.e., on the basis of price, aesthetics, color, size, shape, weight, etc.), but it is mostly used to compare objects in a situation where the bases of comparison are not known. This approach of the MDS is a philosophical perspective because every person experiences the J.P. Verma, Data Analysis in Management with SPSS Software, DOI 10.1007/978-81-322-0786-3_14, # Springer India 2013
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Multidimensional Scaling for Product Positioning
world in their own way. From this perspective, MDS procedure based on the predefined attributes is not completely satisfactory as it fails to take the individual experience into account. One way to overcome this problem is to look at the constructs an individual use to construe the world. Since the MDS is often used to identify key dimensions underlying customer evaluations of products, services, or companies, therefore once the data is at hand, multidimensional scaling can help determine the following: • While evaluating the objects, what dimensions are used by the respondents? • The relative importance of each dimension. • How the objects are placed in the perceptual map. Thus, by using the multidimensional scaling methods, one can analyze their current level of consumer satisfaction in the market and modify the marketing mix based upon the current consumer preference and satisfaction.
What Is Multidimensional Scaling Multidimensional scaling is a sequence of techniques for exploring similarities or preferences among objects. These objects can be
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