Segmentation of clearance sales shoppers based on store attributes

Abstract

Clearance sales are commonly used by retailers selling season goods. These special sales events are designed to increase store traffic and sales. Clearance sales act as stimulus to consumers who are likely to elicit a positive response. To understand these clearance sales consumers, segmentation on the basis of store attributes seems to be more realistic in order to explain the differences among consumers inside a market. Our concern in this paper is to understand the clearance sales shoppers of India and segment them based on the shopper’s perception on clearance sales store attributes. In this sense, the present work starts by analysing the importance of segmenting the clearance sales shoppers on the basis of store attributes. After reviewing the literature of clearance sales, we performed a segmentation analysis of clothing and apparel shoppers in India. First, a hierarchical cluster analysis was carried out, and then k -means cluster analysis identified three meaningfully differentiated customer groups. Further, a classification tree analysis was performed to identify the store attributes that differentiated the clustered groups. Finally, three clusters of clearance sales shoppers namely value conscious shoppers, discount shoppers and merchandise-oriented shoppers are identified. Main conclusions with implications for retailing management are pointed out.