In used as a cellphone but rather like

In this graph, I
used Single linkage clustering (nearest neighbor method) to identify the
outliers, thus eliminate some unsuitable clusters.

I am going to select
4 general segments out of these 9 clusters:

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Segment A (1,6),
Distance (58,934.81)

Segment B (3,7),
Distance (38,225.87)

Segment C
(2,5,9), Distance (88,328.30)

Segment D (4,8),
Distance (28,102.66)

 

Segment A: this
segment has the largest group of consumers, it consists of cluster 1 and 6,
both clusters have moderate neutral segmentation variables. This could mean
that these 2 clusters may represent groups of customers whom would be benefited
from PDA given it satisfies their majority requests/feature. However, given
price and monthly variables are outliers in cluster 1, therefore this could
mean that customers from cluster 1 may be very price sensitive and may only
consider purchasing a PDA only if the price and monthly variables are low.

 

Segment B:
consist of cluster 3 and 7. In this segment, many outliers are shown that
consumers in this segment are not innovators and they are very price sensitive
and only look for economical benefits. These consumers are looking to pay less
for most return, the reason being may be that they don’t necessarily would use
PDA as much as other segments. Another assumption is that, because of their
demand for monitor and remote access is higher than other segments. It may be a
possibility that in this segment, consumers may be in the older generation.

This would also explain the lack of points in innovator variable.

Segment C:
consist of 2, 5 and 9, in this segment, most of their variable points are above
average including monthly fee, and they also seem to be more or less
innovators. Not price sensitive, also likely to use PDA on a regular basis. The
data shows this segment may be the best targeting group considering the size of
the segment and consumer’s attraction on each attributes. May assume this
segment consist of youngsters that are innovative and less price sensitive,
uses PDA on regular basis.

 

Segment D: the
smallest segment out of the 4. Consist of cluster 4 and 8. In this segment,
people are very innovative, not price sensitive at all. But also smaller in consumer
base size. PDA are not used as a cellphone but rather like a handheld pc. More
features of pc functions are demanded, less remote access, cell or messages are
prioritized.

 

Question 2:

 

Segment
A, profile: “potential consumers”

Segment
B, profile: “older Generation”

Segment
C, profile: “daily economical users”

Segment
D, profile: “innovators/ergonomics”

            I would recommend to target segment C
for marketing campaign. The reason being is that this is a fairly bigger
segment that consist more potential consumers than segment D. Segment D looks
like that best fit but it lacks of consumer base. For profit maximizing
reasons, it would be more reasonable to target segment C rather than D. Segment
B are relatively less excited about PDA and its offering features. Segment A
could be a big pool of potential consumers; however, I would still recommend to
go with C first. The reason being is because by analyzing data we can see that
segment C is more likely to accept the product based on its features. This is
also a big consumer base. Therefore, if many from this segment could accept the
PDA it may be a good starting point. People from this segment would start to
recognize the brand and become loyal, after so they may even word of mouth the
products to their friends whom may be in other segments. After the PDA has
somewhat product/brand recognition, we then could start targeting other
segments. Note that segment D would be likely to be targeted along with segment
C naturally because this segment consists of innovators that always stays on
trend. In other words, the company can generate less effort to target segment
D. as customers are likely to be attracted by the product on themselves.