I only collect Optimus so be default I display "by character" but my 8 year old son displays his Transformers by "faction" then by character. So the Autobots display together, normally with all the Optimus' from all lines in one area, Bumblebee's in another. The Dinobots have their own "area" with Grimlocks taking prominence. The Decepticons have their own area below the Autobots and then stuff he doesn't quite think fits either due to size or individuality - eg Predaking he displays separately on top of one of his display cabinets. He's only 8 but he's quite particular about where his figures are placed and takes great pride in his display.