THE IMPACT OF PROMOTION AND ADVERTISING: A LATENT CLASS APPROACH

Typically, marketers define market segments by their demographic characteristics, assuming that these segments represent consumers with relatively homogeneous buying patterns. A more managerially useful definition, however, groups consumers of similar behavior directly and then seeks to find demographic commonalities among them. This study uses a latent class analysis technique to segment consumers based on their responsiveness to a set of marketing variables, finding that a multiple-segment model provides a better fit to the data, and that these segments differ significantly in their responsiveness. By targeting marketing activities to their most responsive segments, the efficiency of commodity promotion can be dramatically improved.


Subject(s):
Issue Date:
2000-12
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/15307
Published in:
Journal of Agricultural and Applied Economics, Volume 32, Number 3
Page range:
441-457
Total Pages:
17




 Record created 2017-04-01, last modified 2017-08-23

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