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02/05/2012

On Brand, Values and Choice
1. Introduction
The main topic of this paper is the choice – the process by which a set of decision-makers selects from a set of choices the best/most suited option. We aim to achieve a threefold purpose: a. To have a better understanding of the “mechanics” of the choice process b. To be able to predict the choices the decision-makers will make c. To be able to find the “drivers” by which the choice can be changed/influenced.

2. Definitions/Notations
2.1 Decision Makers and Choices Sets
Let’s use the following notations: A – the set of decision makers B – the set of choices A few comments here: a. It is important to realize that very often the set of the decision-makers A is a subset of a larger set Atot, (in the context of the larger set A is sometimes referred to as the “target set”). It is important to always keep an eye on which the target set really is – and not to be misled by the size of the total Atot set. This comment is going to be particularly useful in the context of the determination of the dimensionality of the values space (see below for details). For instance, the electoral body in a country is a sub-set of the total population of the country (but for this particular example, do note that the electors deciding not to go to the vote are still a part of the decision makers set, except their choice is “NO ONE” candidate.

b. A particular case is the one where the set of choices is a sub-set of the set of the decision makers, . For larger A sets this doesn’t have major implications, but for smaller sets (dozens to hundreds of items) there can be a significant alteration of the choice process, especially when the items are somehow inter-related and can reciprocally influence their choices. 1|Page robert.komartin@gmail.com

Version 1. the set of buyers of a certain automotive brand is in the range of millions (or tens of millions. the choice of the decision makers is not “forever”. but these become materialized only at voting time. with orders of magnitude). For example. Related to this. the set of decision makers is much larger than the set of possible choices (typically. while doing the same for the set of decision makers is highly impractical and statistical aggregation or clustering techniques need to be employed for effective handling). While we can obviously analyze the automotive brands one by one. This has implications on the effective computational possibilities when analyzing the two sets (we can very often analyze the elements of the set of choices one by one.3 02/05/2012 For instance.komartin@gmail. For instance. In other words. In practical terms.com . I might like a certain brand of jeans today.t) = y. but this becomes “materialized” only when the buyer actually pays for a certain car. the members of the electoral body have their voting preferences at all times. a more accurate form of the function is c : A x T B. c. but allowed in others). which are at the same time elements of the decision makers set. depending on the market). An issue which has a certain importance here is the self-voting (specifically prohibited in certain choice procedures. b. 2|Page robert. where t is the temporal moment of the choice. c(x) = y. when the elector expresses his/her choice by voting one of the candidates. we need to find a suitable way of aggregating the set of buyers in order to allow practical handling of the decision-making process. Therefore. while the set of possible choices is in the range of dozens. when electing the leader of a class.2 Choosing By “choosing” we understand that for each x in A we associate an y in B. 2. and those moments which have a particular importance – we’ll call these “choice materialization”. but it is quite obviously changing in time. In effect. Same. In practical terms. a few more comments: a. a buyer might at all times have a choice for a particular brand of cars. c(x. the set of choices are some of the students. and in most cases we will do so. “choosing” is a function c : A B. we have to distinguish between the potential choice that any decision maker makes at any given moment t in time. For instance. but this might or might not be the case in a year time (or even in a few weeks time).

However. but in other cases the end result of the process is one single choice (as it is the case when one single candidate is chosen.) various importance factors it is rather a post-factum attempt to “rationalize” choices which have already been made by the key decision makers based on the mechanisms we are further going to describe. etc. being rather used as mathematical constructs in the microeconomic theories. at a given moment t. We can mention here two main classes of attempts: a. we must be interested by the very basic outcome (the capability of forecasting for each x A. most of the attempts have failed to pass the test of reality. the actual outcome of the choosing process is more complicated than the simple assignation of a particular choice to each decision maker.3 02/05/2012 c. as a side note. In some cases. namely the one gathering the most of the votes). as it is sometimes referred to). Also. except for very particular cases. 2. The ones which have attempted to map the choices to real numbers – an index-type of construct referred to as the “utility index”.com . the process is not so simple in the case where knowing the desired final outcome we want to determine the influences to the initial process – as some of these rules are functional transformations where it is very difficult to determine the corresponding inverse transformation). and then the choice will simply be the option holding the highest calculated number. we find a way to calculate the magical number. In any case however. and/or by introduction of mediated choices (as it is the case with the electoral processes where the voters choose a set of electors which in turn select the final candidate) or even can go through intermediate steps of choices aggregation and redistribution (as it is the case with some European countries parliamentary voting procedures).3 Further Assumptions The attempts to find analytical expressions for the choices of the decision makers have been at the core of the economical research throughout the last two centuries.Version 1. Very often. as the attempt of giving the criteria (economical.komartin@gmail. functional. Simply put. no matter how appealing these might have been theorized and mathematically conceptualized. Furthermore. the process can be complicated by introduction of multiple-stages choice (as it is the case with two-rounds voting procedures). 3|Page robert. in practical terms we still have no formal description of the way such an analytical expression (mapping choices to real numbers) can be achieved. the association with the corresponding y B) – the rest of the complications being a relatively straightforward application of the selection rules (interesting enough. sometimes) tenders based on selection criteria with weighted criteria are intrinsically flawed. this is indeed the case (as when we analyze the patterns of buying in a certain market – basically in this case we’re interested by the percentage of materialized choices for each element of the choices set – or the “market share” of each choice. we firmly believe all the standard selection procedures followed in public (or private. While in theory this has allowed for spectacular developments.

which I have approached with more details in a couple of my earlier articles). we assign none of these to the above-mentioned “space of values”. therefore.com .1 Core Concept The method we propose is the decomposition of the choice function c into two functions compounded as follows (we assume t constant): c(x)=f(g(x)). we believe the novelty comes rather from the capabilities to formalize the method and to use this formalism for forecasting and influencing purposes. and B which we will refer to as the values space. while function f is associating to each multi-dimensional point/vector in the values space a unique point in the set of choices (easier said than done. with is multi-dimensional real vector space.komartin@gmail. which can be somewhat more difficult to demonstrate). This theory fails to the reality test because of the intransitivity of choices (i. we will need to assume that function f’ can be reversed. as the natural connection really is the function f’ : B S.e. this is decision maker’s “point of view”). which we will call the personal preferences point (jokingly. exploiting the so-called “consumer irrationality”. The ones which have attempted to infer the actual choice from the ranking of the buyers/consumers preferences – the so-called preferences theory (i. The method in itself it is not new – the attempt to influence buyers choice by carefully crafting and manipulating the core values and the identity of the product is the quasi-standard approach/road traveled by marketing/branding firms. 3. The Proposed Approach 3. inspired by the concept of semiotic spaces (following the sense given to the concept by the semiotic algebra. when in fact the correlations is mediated by the space of values the set of decision makers believe in. associating to each choice the point in the values space.e. Please note that although the word “value” is highly charged with ethical and moral connotations. This has led to interesting developments to what is called “behavioral economics”. the above sentence can be continued: … but Anna prefers bananas to cherries). where: g:A f:S S.Version 1. but unfortunately has provided no operational manner to infer the actual choices from the knowledge we have regarding the decision makers and their options. 4|Page robert. We believe the problem is rather related to the attempt of finding a direct form of correlation between the set of decision-makers and the set of choices. and the set of choices exhibit (manifest). We are rather talking about an intermediate real vector space. S In plain English. hence she will choose cherries).3 02/05/2012 b. and cherries to apples. Anna prefers apples to bananas. the function g is associating to each x decision maker a multi-dimensional point (or a vector).

e. we will define a dimension/a coordinate measuring the degree to which that attribute is or not met. without introducing implicit correlations between the attributes. In order to make things simpler.komartin@gmail. the dimension will measure this attribute (the degree of “coolness”) from +1 (total coolness) to 1 (total lack of coolness). characteristics) to be followed as dimensions in our space. Therefore S is in fact the [-1. Taking an example. we will need to norm the space (not from 0…1. it is to be replaced with “correctness” or another close synonym for the context). 1]n. attributes. some of the dimensions could be seen as belonging to multiple research areas (and therefore they could be stored in “choice databases” and reused when useful).3 02/05/2012 3. values. where the attribute is negative in meaning replace it with the positive version (e. for each “value” (okay. In order to determine the dimensionality of our value space a classic type of marketing research can be performed with the set (or a random representative subset) of the decision makers. A major issue to be solved is how the actual numbers will be inferred from questionnaires.g. but rather from -1…1. design to extract all the keyword (i. We recommend using positive (in meaning) attributes for the dimensions.com . It is to be noted that although the resulting spaces are domain-specific. Basically. if one “value” for the choice of jeans is to be “cool”. to capture the negative preferences too). let’s call it attribute to make things more neutral) that can be identified in relationship with our set of choices. real vector space. if the attribute “corruption” appears.2 Multi-Dimensional Values Space The first step we need to take is to define the multi-dimensional values space.Version 1. The resulting space will look as follows (we assume a number of three key values/attributes we track): 5|Page robert.

all figures throughout this paper are represented as 3D images. or to apply calculation corrections to “straighten” them. Furthermore. or by visualizing sections of the values space. for spaces with a big number of dimensions. then we will either have to eliminate the redundant dimensions – the ones having correlation coefficients close to 1. Geometrically. one must remember that the practical applications will routinely have (much) more than 3 dimensions – meaning the approach will have to be either purely abstract. having such dimensions would look something like the figure below: The obvious idea would be to assimilate the “angle” between the dimensions with a transformation/function of the correlation coefficient between the values/attributes considered. we can mentally represent the sets of correlated dimensions as “beams of related values”. It is obvious that in order to calculate numerical (i. However.com . and hence: 6|Page robert. In case the dimensions are not orthogonal.e. rather than the “naïve” attempt to get to one number by compounding the factors by addition of each factor weighted with “importance”: It is important to make all the efforts possible to have an orthogonal space (to simplify the demonstration.komartin@gmail. as this is the highest level of complexity the human eye/mind can directly visualize. this means that the attributes chosen have to have negligible correlation coefficients).Version 1.3 02/05/2012 As a note. in order to measure the length of the resulting vector to a given point from origin) we will use the Euclidean metric. conversion to real numbers) values for the distances between two points in this space (or.

We determine for each decision maker the “mix” of attributes which best describes its choice pattern (the way to “extract” this is quite well known from the traditional marketing toolset). We identify the choice corresponding to the above-mentioned mix. we anticipate the need of using the tensor analysis techniques (oblique coordinates systems/tensors in rectilinear multidimensional coordinates) in order to cope with the non-trivial calculations of distances and coordinates transformations.3 Theoretical Choices In theory (by that we mean that a. we suggest the following approach: a. etc. due to the current lack of practical attempts to build an actual values space. complete linkage clustering. In order to go around these issues.Version 1.com . and often times demographic characteristics are listed for each cluster).3 above are related with the assumptions we made (that we can actually analyze the set of decision makers one by one and that we can find a choice corresponding to the exact multi-dimensional values space point). the main issues with the approach sketched at 3. UPGMA. and one has to keep in mind that there is one more factor which we mentioned in the beginning and then taken out of the analysis. for each point in the space S of values we can find a choice “embodying” that particular set of values/attributed). The difference in this case is however that we can actually apply quantitative techniques of clustering (single-linkage clustering. the simplest (starting step) would be the transformation from the contra-variant to covariant coordinates following the formula: 3.) – starting from the statistical sets of 7|Page robert. For instance.3 02/05/2012 However. It is however easy to see that the above process is utopian (as a matter of fact. In this case. we introduced the concept of space of values especially because the straightforward selection of choices does not work…) 3. having the “center of weight” as the most representative point in the space of values. namely the time: it might be the case not only that the dimensions are oblique in this space but also the angle between them has a time variation). 2. we propose the clustering of decision-makers set as a solution. This solution roughly corresponds to the concept of “persona” from the traditional marketing research (the target decision makers are grouped into groups of “like-minded” people. rather than the exceptional situation. one has to take into consideration that we might be simply unable to avoid the issue of the oblique coordinates system (it might be that correlated dimensions prove to be the typical. Regarding the first issue. the process of determining the choice will go as follows: 1.komartin@gmail. we can analyze the set of decision makers one by one and that b.4 Practical Considerations As one can easily see.

b. one could infer extended demographic characteristics of these clusters/personae. As a note. although this may seem an artificial construct.com .komartin@gmail. we will assume that the entire cluster decision is replaced by the decision of its center (and once knowing the percentage in total population for the entire cluster the calculations will be pretty straightforward). Regarding the second issue. probably a useful selection would lead to 2-7 clusters. Moreover.Version 1. this would look as follows: 8|Page robert. it is in fact quite similar with the method by which humans operate classifications. the actual number of resulting clusters is actually dependent on the chosen sensitivity threshold (under what distance are different items classified as being part of one cluster) . by using data mining techniques.3 02/05/2012 random representative samples analysis.but while we can have any number of clusters from 1 to the very number of items. we will replace the calculation of the reverse function f’ by a decision function defined as as the selection of the “closest option to the cluster center of weight” – again based on Euclidean distance metrics: f(s) = y for which the following is met: In geometrical terms. Further. The result would look somewhat like in the following figure (we kept the assumption of three dimensions/values in our space): Quite obviously.

In plain English – imagine an arrow entering a cluster: it will “hit” (or be near) first a few choices. and then less choices until finally it exits the cluster. An interesting comment here is that the multi-dimensional representation of the clusters can lead to already well known results when projecting it on lesser dimensional (n-k) spaces. until reaching a maximum. The most important problem which the method can raise is that in reality.3 02/05/2012 What the above is basically trying to convey is a quantitative method for identifying the closest brand (from the choice set) to the typical preferences of a given cluster of decision makers. the famous “reversed U shape” of the preferences by an attribute is in fact a representation of the density of the choices along a 1-dimensional projection through a cluster. 9|Page robert. then more. by looking which decision-makers fall into the choice’s “sphere of influence” with the gradual increase of the distance from the choice (actually.Version 1. would also explain the multiplicity of Ushapes depending on the different target groups/clusters. the cluster has a certain probability to make choice A. One way to circumvent that (while still keeping aggregated analysis) is to treat the distance function as a distribution of probabilities (hence. There are obviously several massive simplifications in the above method – and further work is needed to reach to better/more accurate results. For instance.com . some of the cluster members can be at minimal distance from another choice point). and so on and so forth).komartin@gmail. the cluster never takes 100% the same choice – its members can reach to different decisions (and the reason for that is that while the center of a cluster can be at minimal distance from a certain choice point. This. another probability to make choice B. Another way which may be considered is to “count” the votes starting from the choices (which are a single point in the multi-dimensional space). the word “sphere” here is more than a figure of speech – the actual method to do this in practical terms would be to model spheres with centers in the respective choices and to “inflate” them by increasing the radius of the sphere – looking then how they “incorporate” parts of the decision-making clusters). of course.

the key is the threshold distance which allows one to see a point as being “in” or “out” of the cluster. depending on the level of granularity we look at the group of decision makers. 4. More precisely.moving the position of a choice closer toward massive clusters (in electoral terms. The main categories of influences can be grouped as follows: a.komartin@gmail. when we discuss about this. which can reduce significantly the predictive power of the analysis. based on the above mentioned techniques. this corresponds to changes in the candidate speech in order to please a major electoral group) 10 | P a g e robert. one can gain additional insight into the possible ways of influencing the outcomes of the decision process. Influencing the Selection Process Just as a brief enumeration. Therefore. in practice much more asymmetrical patterns can be encountered. we place ourselves into the partisan position where there is one (or more) choices we prefer and all the other choices (“alternate choices”) which we envisage to decrease in importance. Influences on the position or structure of the choices in the values space: .3 02/05/2012 Another issue (related to the one above in its implications) is the actual shape of the cluster – while we assumed the cluster are more or less spherical.Version 1. we are not to be fooled by the above: a “cluster” is not something having a “real” existence (it is not a “thing”) – it is merely a hidden convention the brain is using to classify things.com . For instance: Again. Obviously. the first figure above can be seen as one cluster or as two clusters.

In a geometrical fashion. c. by influencing its: .Position – targeted marketing in order to approach the overall cluster position towards the position of the choice (something like “Pepsi is the choice of the new generation”). b.adding supplemental choices which could act as attractors of decision-makers.moving the position of an alternate group further from massive clusters (negative campaigns determining the move of the competitive choices far from the major groups) .komartin@gmail. by: . Influences in the structure of the values space itself – this is perhaps the most subtle (but a t the same time difficult) approach – consisting in the alteration of the values defining the framework of reference.Adding supplemental dimensions – add into the discourse a completely novel element (to which our preferred choice is/could be closer) – which would in turn force an element of differentiation not present before (leading to the limit even to fragmentation of major clusters of decision making). and/or . with either the purpose of increasing market share (for the sake of it or for later rounds of decision making) or with the purpose of just decreasing the “basin of attraction” of a competitive choice.com .Overall shape – by providing splits within clusters (“secession” moves) or by joining clusters together (“unionist” moves). the addition of supplemental dimensions would look something like: 11 | P a g e robert.3 02/05/2012 .Version 1. Influences on the structure of the clusters in the values space – this refers mostly to the clustertargeted messages which could steadily getting it closer to the desired position of a given choice.

The development of a step-by-step/cookbook minimal methodology. which would allow the application of the method in practical circumstances d. e. Conclusions We will conclude by saying that we believe the above-sketched method provides the basics of a novel approach. Of course. Therefore. the author is the first to reckon that significant additional work is needed. e. tat two categories are in fact more and more different. 5. and then the detailed description of the ways of quantifying those).3 02/05/2012 . improving the forecasting capabilities of the selection processes. as well as providing insights into the possible ways to influence/change/alter these. The detailed analysis of the possible ways of altering/changing the outcomes of the decision-making processes e.Deleting dimensions – this would basically consist of deprecation/elimination from the public speech of one of the elements (by placing it into derision mode. To a large extent. The improvement of the actual calculation methods (pilot test the various clustering algorithms. most of the “technical” complexities are rather related to the fact we are trying to formalize the process in a mathematical way and to make it accessible for simulation by sequential computing machines. as well as for additional what-if analysis of alternate decision scenarios (although large parts of the analysis can be covered with traditional math and statistical packages). “free economy is liberty”.g. rooted in classical statistical methods coupled with concepts taken from semiotic algebra. The development of automated software tools which would allow for fast calculations of each of the steps of the method.Changing the angle between dimensions – by changing the correlation coefficient between the considered attributes (communication implying that two categories are more like the same. while the brain processes the flow as a natural massively parallel computing instrument. we believe that the process described is simply put an attempt to model the natural way the brain performs its choices (a succession of neural nets fired up in the following sequence: concept -> associations/attributes -> choices). . or the opposite.com .g. A key issue here might prove also to be the “how” of the actual dimensions selections b. rather to introduce a new way of thinking the topic. The refining of the data gathering methods (first and foremost to decide what techniques are to be used for data gathering. mainly for the following directions: a. “capitalism does not mean freedom”. which could provide a better understanding of the decision making/selection processes. 12 | P a g e robert.Version 1. in order to void a key differentiator of an alternate choice. for instance). and perhaps even more importantly the application of the tensor analysis to the value spaces) c.komartin@gmail. verify options available for turning the calculations from simple real numbers into distribution of probabilities.