Assessing the Stability of Market Segment – A fuzzy Clustering Approach

Abstract

Market segmentation is the process of grouping potential consumers of like-minded decision makers for rendering the company’s market offerings. Most of the market segmentation research results portraits, only the profile of the segments and the market size. The size of the market is always a question mark for its consistency, because the consumers’ decision to prefer a brand is fuzzy in nature. This paper addresses the limitation of crisp cluster over fuzzy segmentation and moreover emphasizes the method to measure the level of stability of the resulted segments. To empirically investigate, a study was conducted on the preferences of motor bikes among college going boys in southern part of Tamilnadu. The result of the research reveals that the segmented market was fuzzy in nature which reflects the real market situation. The resulted fuzzy segments were labelled as ‘economic class’, ‘elation class’ and ‘robust class’ and later it was compared with the crisp clusters to assess the stability of each segment. Marketing managers can chosse the segment based on its stability and this research paper adds value to literature by providing a formula for arriving a stability score for each segment.