Identifying consumer heterogeneity in unobserved categories

Abstract

Categorization has been extensively studied in both the psychology and marketing literatures. However, very little methodological research has demonstrated the heterogeneity in consumers’ unobserved category structures and activations. We propose a new latent structure procedure that simultaneously identifies the unobserved categories that consumers use and represents consumer heterogeneity via different groups of consumers who have activated different unobserved latent categories. The results of an empirical study in Sports Marketing about sports fans’ perceptions of various sports illustrates how the proposed methodology can capture heterogeneity at the group level and account for a variety of different category structures.