Customer Wants & Needs / Sentiments :

Principles & Processes

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Processes for the design of sentiments:
◼ Getting the feelings:
❑ Setting up questionnaires
◼ Identification:
❑ Factor analysis/ cluster analysis to analyze the feelings
for grouping into sentiments
◼ What will be the sentimental elements for the
design:
❑ Use multiple regression to formulae solutions

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Getting the feelings

Through literature review or interviews of key

stakeholders
◼ To find out the related variables to be asked
in the questionnaire
Or
◼ To establish a model representing the
relationships between the variables and
employ it in the questionnaire

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Questionnaire Example st
(1 . Survey)
Factors which affect
consumer to buy the
beer
Taste 1 2 3 4 5 6 7
Aroma 1 2 3 4 5 6 7
Color 1 2 3 4 5 6 7
Size 1 2 3 4 5 6 7
Alcohol Percentage 1 2 3 4 5 6 7
Cost 1 2 3 4 5 6 7
Reputation 1 2 3 4 5 6 7

◼ Rating Scale: usually 5 or 7 levels

◼ Other Information
❑ e.g. Personal Data: Age, Sex, Marital Status

❑ e.g. How often the consumers drink beer?

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Calculation of Sample Size

𝑍 2 𝑝𝑞
◼ 𝑛=
𝐸2
where n = The sample size
p = The proportion of the population that has a given characteristics
q=1-p
= The proportion of the population not having the characteristics
pq = Measure of sample dispersion
Z= Z value of the desired percentage of confidence level; some common
values of Z for selected percentage of Confidence Level – 1.645 for 90%, 1.96
for 95%, 2.33 for 98% and 2.58 for 99%
E = Margin of Error

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Example

◼ Suppose that the Gallup Organization wants

to conduct a poll to find out the percentage of
people in the United States think that the
president is doing a good job, assuming you
want a 95% level of confidence level (Z =
1.96). The desired margin of error is 3.1%.
Calculate the sample size required for the
poll.

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Example

𝑍 2 𝑝𝑞
◼ 𝑛= 2 , Z=1.96, E=0.031%=0.031,
𝐸
◼ Using the worst case scenario, that is p=0.5
1.962 ×0.5×0.5
◼ 𝑛=
0.0312
◼ n = 999.38 → 1000

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Identification - Data Analysis

◼ Factor Analysis
- Confirmatory Factor Analysis
- Exploratory Factor Analysis
◼ Cluster Analysis
◼ Correlation

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Confirmatory Factor Analysis
◼ Structural Model defined by literature review

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Structural Equation Modeling (SEM)
◼ To discern whether the pattern of variances
and covariances in the data is consistent with
the specified structural model
◼ May need to improve the model by modifying
the structures of the model so as to fits the
data
◼ Finally, the modified model can be confirmed

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Exploratory Factor Analysis

The most frequent used approach:

◼ Principal Component Analysis (PCA)
- Transforms a set of variables into a new set
of composite variables (or principal
components) that are not correlated with
each other

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Principal Component Analysis

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Principal Component Analysis (cont’)

◼ Consider the situation with only two variables

x1 and x2,
◼ The new synthesized variable U1 can
represent most of information of x1 and x2
◼ U1 is a first principal component
◼ U2 is a second principal component that
orthogonal to U1

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Principal Component Analysis (cont’)

◼ The first principal component/ factor, U1

- The best linear combinations of variables which
accounts for the highest variance in the data
◼ The second principal component, U2
- The best linear combinations of variables for
explaining the variables not accounted for by the
first principal component
◼ The process continues until all the variance is
accounted for the data

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Scree Plot (Eigenvalue Plot)

◼ Eigenvalues > 1
◼ Any individual factor
should account for the
variance of at least a
single variable
◼ 2 components is
identified in this case

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Cluster Analysis

◼ A technique for grouping similar objects or

people.
◼ Different clustering methods:
- K-Means Cluster Analysis
- Hierarchical Cluster Analysis
◼ Depending on the selected clustering
methods,
◼ The similarities may be based on the
correlations, Euclidean distance, & etc.

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Cluster Analysis on Three Dimensions

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Correlation
◼ The correlation coefficient is a measure that
determines the degree to which two
variables' movements are associated. The
range of values for the correlation coefficient
is -1.0 to 1.0. If a calculated correlation is
greater than 1.0 or less than -1.0, a mistake
has been made. A correlation of -1.0
indicates a perfect negative correlation, while
a correlation of 1.0 indicates a perfect
positive correlation.

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Correlation

◼ The strength of the relationship varies in

degree based on the value of the correlation
coefficient. For example, a value of 0.2
indicates there is a positive relationship
between the two variables, but it is weak.

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Correlation

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Correlation

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What will be the sentimental elements
for the design

◼ The 2nd. Survey:

◼ The questionnaire is established based on

the variables in the first principal component
◼ e.g. The market available dog toys

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Method to formulae solutions

◼ Multiple regression
- To develop a self-weighting estimating equation
- The variables in the equation should be
measured by interval/ ratio scales
- Nominal variables should be coded as 0, 1
- The established equation can be used to predict
the values for the dependent variables

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Multiple Regression Equation

Y = ß0 + ß1 X1 + ß2 X2 + … + ßn Xn + ε

where ß0 = A constant, the value of Y when all X

values are zero
ßi = The ß represents the regression
coefficient associated with each Xi
ε= An error term, usually assumed to be 0

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The established regression equations

“Want to pat”
= 2.447 + 1.111 x “Made of fur”
– 0.690 x “Hardness” + 0.847 x “Barking”
+ 0.773 x “Stand up” + 0.730 x “Grumble as
you grab my tongue”

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“Want to stroke”
= 2.501 + 1.161 x “Made of fur”
– 0.817 x “Hardness” + 0.764 x “Barking”

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“Want to scratch”
= 2.130 + 0.909 x “Made of fur”
– 0.656 x “Hardness” + 0.693 x “Grumble as
you grab my tongue” + 0.654 x “Barking”

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The optimal combination of product
features

The feeling of “want to pat it”

◼ The product is made of fur

◼ The product is soft

◼ The product have barking sounds

◼ The product that response to touch by

standing up
◼ The product that grumble if you grab its
tongue
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The feeling of “want to stroke it”
◼ The product is made of fur

◼ The product is soft

◼ The product have barking sounds

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The feeling of “want to scratch it”
◼ The product is made of fur

◼ The product is soft

◼ The product grumble as you grab its tongue

◼ The product have barking sounds

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Q&A

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