Empirical Study of Market Segmentation Based on Factor Clustering Analysis Model

This paper studies the application of the compound model of factor analysis and cluster analysis in the market segmentation of telecommunications services. Fourteen observed variables of consumers´ attitudes to mobile communication company are represented by three public factors through factor analysis. Then according to different public factor scores, the samples are clustered to four segmentation markets by K-means cluster analysis. Four segmentations´ respective market development proposals are put forward.