Summary
Comparing groups (e.g., customer segments) with respect to hypothetical constructs requires that the measurement models are equivalent across groups. Otherwise, conclusions drawn from the observed indicators regarding differences at the latent level (mean differences, differences in the structural relations) might be severly distorted. However, with the exception of intercultural studies, at present researchers in business administration do not pay enough attention to this issue. This article provides a state of the art on how to apply multi-group confirmatory factor analysis to assess measurement invariance. The required steps in the simultaneous analysis of the indicator means and variances/covariances are described, placing special emphasis on how to determine noninvariant indicators (“partial measurement invariance”). Here, different approaches to the identification of latent scales as well as the main test strategies are discussed. The procedure is demonstrated considering the construct brand strength (“Brand Potential Index”, BPI®) introduced by GfK Market Research as an example. The empirical study shows that the indicators buying intention and intention to recommend the brand are noninvariant across loyal and non-loyal consumers. Since the remaining seven BPI® indicators are invariant, comparisons at the latent variable level as well as for the invariant indicators are meaningful. Observed group differences in buying intention overestimate the underlying group differences in perceived brand attractiveness. Possible statistical as well as substantial explanations for these findings are discussed.