Market Segmentation for Customer Satisfaction Studies via a New Latent Structure Multidimensional Scaling Model

Applied Stochastic Models in Business and Industry, Volume 21, Issue 4-5, Pages 303-309, 2005

Posted: 11 Jun 2016

See all articles by Jianan Wu

Jianan Wu

Louisiana State University, Baton Rouge - E.J. Ourso College of Business Administration

Wayne S. DeSarbo

Pennsylvania State University

Date Written: July 1, 2005

Abstract

It has been well documented in the marketing literature that customer satisfaction is critical to any businesses' success. However, it is far less clear as on how marketers comprehend customer differences in customer satisfaction evaluations, and leverage such understanding in forming their marketing strategies. Only recently have researchers begun to explore the notion of individual or segment differences in the formation of overall satisfaction judgments.

To extend the exploration of unobserved customer heterogeneity in customer satisfaction studies with multiple attributes, we propose a latent structure multidimensional scaling (MDS) model to visually depict unobserved customer heterogeneity with respect to the theoretical components of customer satisfaction judgments. Our model is developed on the basis of the well-established expectancy-disconfirmation theory of customer satisfaction. We describe the proposed MDS model and discuss the technical aspects of the model structure and maximum likelihood estimation.

Suggested Citation

Wu, Jianan and DeSarbo, Wayne S., Market Segmentation for Customer Satisfaction Studies via a New Latent Structure Multidimensional Scaling Model (July 1, 2005). Applied Stochastic Models in Business and Industry, Volume 21, Issue 4-5, Pages 303-309, 2005, Available at SSRN: https://ssrn.com/abstract=2793430

Jianan Wu

Louisiana State University, Baton Rouge - E.J. Ourso College of Business Administration ( email )

Baton Rouge, LA 70803-6308
United States

Wayne S. DeSarbo (Contact Author)

Pennsylvania State University ( email )

University Park
State College, PA 16802
United States

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