Acquisition pattern Analysis with Mokken scales: Applications in the financial services market
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In my opinion, the purpose of reviewing a book is not only to summarise it but also to make a potential buyer want to read it. That is what I am trying to do here. First of all, it is a well written piece comprising five chapters which have, for the most part, already been published as papers. In fact this book is a dissertation, but it is easily readable by practitioners and students. It also clarifies some points, for the academics, on a relatively little-known technique — the application of Mokken scales in the field of financial services within a relational perspective. Numerous aspects of the use of these scales are developed in the book. The first chapter introduces the subject. All the reasoning is originally grounded on the segmentation of consumer needs into generic group needs. That is, within a particular set of needs, the products the consumer holds are (a) functionally bundled and (b) not acquired at random. Consumer purchases follow a certain order which can be called an acquisition pattern. There are numerous sets of generic needs, for example, the ‘comfort set’, the ‘hygiene set’, the ‘entertainment set’ and so on.
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Database Marketing & Customer Strategy Management
Here, the purpose of Mokken scales analysis is to reveal combinations of products owned by consumers and the sequences in which these products are acquired. Acquisition pattern analysis also refers to a consumer’s lifecycle and knowledge of this pattern should encourage companies to offer appropriate products at the relevant period within the consumer lifecycle. The author also specifies that, using these scales, it should be possible to describe consumer purchases of financial products at a higher level of granularity than at the level of a single acquisition. It should be noted that the financial services market is complex because of the existence of many and various products that have almost the same utility but are often labelled differently. In order to carry out acquisition pattern analysis, the set of generic needs of concern must first be defined. This is done by observing which products are often owned in combination. The next stage is related to the properties of the well-known Guttman scale: for instance, to position both services and individuals along a latent trait that reflects not only the complexity of the service but also
Vol. 11, 4, 386–388
䉷 Henry Stewart Publications 1741–2447 (2004)
Book review
the financial maturity of the customer. In brief, consumers are likely to acquire products first for satisfying more basic needs, more complex needs are satisfied later in the lifecycle. Furthermore, the position of one particular individual on this latent dimension can be interpreted as a function of a combination of personal characteristics such as sociodemographics, expertise and position within the lifecycle. Moreover, such analysis allows the gathering of information on longitudinal purchase patterns, from cross-sectional data collected through an ownership matrix. Consisting of one and zero, according to the po
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