1. Factor Analysis By: Vineet Jogalekar Vinayak Potadar Sucheta S. Sirsikar

2. FACTOR ANALYSIS A data reduction technique designed to represent a wide range of attributes on a smaller number of dimensions.

3. FACTOR ANALYSIS For example, suppose that a bank asked a large number of questions about a given branch. Consider how the following characteristics might be represented by just a few constructs (factors).

4. FACTOR ANALYSIS

5. BENEFITS A more concise representation of the market situation. Fewer questions may be required on future surveys. Identification of groups of interrelated variables to see how they are related to each other. Factor analyses can be used to identify hidden dimensions or constructs which may not be apparent from direct analysis. It is easy and inexpensive to do.

6. CONDUCTING FACTOR ANALYSIS Formulate the problem Determine the method of factor analysis Determine the number of factors Rotate the factors Interpret the factors

8. SPSS DATA

9. COMPONENT MATRIX OBTAINED FROM SPSS

10. WHAT SHALL THESE COMPONENTS BE CALLED?

11. THESE COMPONENTS MAY BE CALLED AS ATTRACTIVENESS TRUSTWORTHINESS EXPERTISE

12. CALCULATE COMPONENT SCORES TRUSTWORTHINESS = (Dependable + Honest + Reliable + Trustworthy + Sincere)/5 (0.6874) ATTRACTIVENESS = (Attractiveness + Classy + Beautiful + Elegant + Sexy)/5 (0.9) EXPERTISE = (Knowledgeable + Qualified)/2 (0.756)

13. APPLICATIONS IN MARKET RESEARCH Used in market segmentation for identifying the underlying variables to group the customers. Identify the brand attributes that influence consumer choice Identify the characteristics of a certain type of customers (eg. price sensitive)

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