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CHAIDChi-Squared Automatic Interaction Detector (market segmentation technique)
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In the CHAID analysis, which is introduced in the following section, the cut-off point is where the greatest degree of differentiation between groups exists and can be established statistically based on the chi-squared test.
The rest of the variables employed showed no predictive capacity in relation to cocaine use (see Figure 1, CHAID Analysis).
Several classification tree methods have emerged over the years besides the CART method, namely, Advanced CHAID and QUEST.
During creation of 'decision tree' using the net profit margin as dependent variable, it was shown that the best method is CHAID method.
CHAID analysis constructs tree-like hierarchical relationships among variables.
Some classification tree programs, such as FACT (Fast and Accurate Classification Tree) (Loh & Vanichestakul, 1988), THAID (Theta Automatic Interaction Detection) (Morgan & Messenger, 1973) and related programs such as AID (automatic interaction detection); Morgan & Sonquist, 1963) and CHAID (chi-square automatic interaction detection) (Kass, 1980) perform multilevel splits, rather than a single or binary split when computing classification trees.
At the root of these are statistical methods ranging from classification trees, like CHAID, to regression models to neural networks.
5 - that operate on continuous or categorical data following normal, k-means or static preprocessing; CHAID analyses the statistical significance of possible decisions while C4.
CHAID is a multivariable procedure for the analysis of contrasting groups of nominal and ordinal data.
In previous tests performed by Compaq for customers performing CHAID and neural network analyses, AlphaServers running Compaq's Digital UNIX finished 12 times faster than the same programs executed on a competitor's 32-bit UNIX.
The CHAID algorithm was applied in decision tree and the Statistica Data Miner software was used.