Factor analysis to fine tune product strategy


Leading CPG manufacturer with operations in multiple countries.


The client wanted to fine-tune its product strategy in key markets for beverage products. The client sought to understand the underlying factors that influence consumption of beverages.


SG Analytics formed a dedicated team to provide a solution to this business problem. The team divided the data and problem into micro-segments and created specific milestones using the following four-step approach:
  • Using the maxdiff analysis technique, SG Analytics conducted a survey in one of the markets to gauge the attributes that drive consumer decision of buying beverage products.
  • The team conducted a factor analysis study to derive the factors covering both emotional and functional attributes that appeal to the consumers.
  • Our data scientists used the obtained factor scores along with the contextual variables to identify the statistically best-fit discriminating variable using a clustering analysis. The team further iterated the process to identify multiple descriptors that fully segmented the survey data to create a driver tree.
  • From the driver tree, we were able to create profiles of consumers having a unique set of needs.


Helped the client understand consumer needs which helped devise beverages product strategy.
Aided in improved understanding of consumer tastes, leading to better consumer targeting.
Improved beverages revenues for the key markets by 15% year-on-year.