Segmenting luxe-bargain shoppers using a fuzzy clustering method

Lim, Chae Mi and Kim, Youn-kyung and Runyan, Rodney (2013) Segmenting luxe-bargain shoppers using a fuzzy clustering method. International Journal of Retail and Distribution Management, 41 (11-12). pp. 848-868. ISSN 0959-0552

Abstract

Purpose – This study aims to identify consumer segments among luxe-bargain shoppers using a fuzzy clustering method based on psychographic variables related to both luxury consumption and bargain processes and profiles the identified segments in behavioral tendencies. Design/methodology/approach – The sample consists of 500 consumers who purchased a luxury brand at a bargain. The analyses involve running a confirmatory factor analysis, a fuzzy clustering analysis based on psychographic variables, and ANOVA for profiling the segments. Findings – A fuzzy clustering analysis identifies four distinct segments: deal hunters, sale-prone shoppers, active luxe-bargain shoppers, and royal shoppers. Each consumer segment exhibits differences in consumer characteristics, demographics, and behavioral tendencies. The study provides insight into varied luxury consumers. Research limitations/implications – In an effort to fill the gap between traditional framework in luxury research and today's luxury market that provides accessibility of luxury items at lower price points to mass consumers, this study introduces a new concept of “luxe-bargain shopper” and examines varied luxury good consumers in the bargain shopping context. However, the findings of the current study should be interpreted with caution due to sampling method, product category of luxury brands, the limited number of luxury brands used in the study. Practical implications – The results provide marketing suggestions for each segment of luxe-bargain shoppers. Originality/value – There is virtually no luxury study conducted in the context of bargain shopping. By examining luxe-bargain shoppers using a robust fuzzy clustering method, this study extends our knowledge of luxury consumption as well as provides a new perspective to segmentation research.