CONSUMER SEGMENTATION MANAGEMENT AND SERVICE IMPROVEMENT: A CLUSTER ANALYSIS OF THE PORTHARCOURT ELECTRICITY DISTRIBUTION COMPANY

Abstract

This study explored segment customers of the Port Harcourt Electricity Distribution Company (PHEDC) based on service delivery performance and customer satisfaction levels. Customer segmentation is an aspect of demand perspective to production. Specifically, the study sought to identify distinct customer segments within the PHEDC customer base based on relevant demographic, geographic and consumption patterns in Calabar Metropolis. One hypothesis was tested. The study anchored on segmentation theory. Cross-sectional survey research design was adopted, sample size of one hundred and thirty-nine (139) was drawn from finite population of 685,000 using Finite Population Correction (FPC) formula. Mixed sampling technique was adopted. Data were obtained through primary source (questionnaire). Data analysis was carried out using: cluster analysis techniques (Hierarchical and K-Means), were used in segmenting customers based on demographic, geographic and behavioral variables as well as different needs and expectations. The study revealed two, three and four different clusters. Descriptive statistics was used in determining needs and expectations of different customer clusters considering the mean and standard deviation values. Levene’s test for homogeneity of variance was conducted across the variables. One-Way Analysis of Variance (One-Way ANOVA) was used in testing the hypothesis at 0.05 significant level. The results of the analysis showed that, there were significant differences among variables which led to application of Post-hoc Test in determining multiple comparisons. The study recommended among other things that, tailored service improvement plans should be developed by PHEDC for each identified customer segment for the purpose of addressing their specific needs and priorities.