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Marketing Segmentation Tree Diagram Chart Software

Segmentation Tree software is a data mining tool that makes tree diagrams which are useful for marketing segmentation and classification analysis, typically for customer segmentation and item segmentation.

What: Marketing segmentation tree diagram chart software

Segmentation Tree makes a segmentation or classification analysis in terms of given characteristics. The method iteratively splits sample data in two branches for each variable and finds the highest discriminant value, which stands for the strongest relationship between the chosen criterion and the sampled data. The procedure loops until all cases have been assigned to one branch. The easiest way to figure out how Segmentation Tree works is to think about regression analysis. Say we were interested in finding which factors have the strongest relationship on the dependent variable Purchase of ice cream (called Criteria in Segmentation Tree) and we used 3 independent variables in the model: air temperature, availability of money, sense of craving. With multiple regression we can measure the degree and form of relationship among variables. With Segmentation Tree we identify groups of similar cases in terms of relationship to the dependent variable, and they are shown graphically in a tree diagram. Segmentation techniques require large samples for reaching useful conclusions. When the segmentation is run, what makes a variable important is the strength of its relationship (level in the tree diagram) and the number of cases it covers.

When: Segmentation tree software for marketing segmentation and classification

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For instance, say we were interested in identifying the demographic factors that most highly relate to the purchase of vitamin tablets, and a marketing research agency ran a sample survey for us. We can use the dataset for drawing a segmentation tree, which shows in pictorial form the number of people belonging to one segment (tree leaf) and which variables relate most to the use of vitamins in that group. Advertising campaigns, direct marketing actions, and promotional plans are some of the activities that require marketing managers to identify groups of people, which are homogeneous in terms of given characteristics. When the need arises, you can use one the segmentation techniques that in the past 40 years have blossomed from William Belson's original work on matching and prediction, such as AID (Automatic Interaction Detection) and CHAID (Chi Square Automatic Interaction Detection), THAID (Theta AID), and CART (Classification and Regression Trees).

Who: Segmentation tree software for marketing and management decision-makers

The Segmentation Tree tool is used by business decision-makers often supported by business analysts. Among our business decision-maker clients there are:

• General Managers and CEOs
• Business Directors
• Marketing Managers
• Sales Managers
• Business Analysts
• Marketing Analysts
• Advertising Managers
• Pricing Managers
• Quality Managers
• Product Portfolio Managers