ANALYTICS
Q. What is Factor Analysis?
A. A technique used to examine the relationships among a set of variables in order to identify an underlying structure to those items
Q. When would you use it?
A. Factor is widely used as an input into other analysis - for example cluster analysis/segmentation analysis.
Q. What are the advantages?
A. It can reduce a large number of variables that would be otherwise be cumbersome, time-consuming or simply impractical to analyse individually to a more manageable smaller number of factors
Q. Any disadvantages?
A. The reduction of a large number of variables to a small group of factors can lead to some loss of sensitivity in analysis
