Data Clustering and Customer Segmentation

• Cluster analysis, or clustering, involves automatically discovering natural grouping in data.

• A common example of clustering is customer segmentation.

• In today's competitive world, it is crucial to understand customer behavior and categorize customers based on their demography and bying behavior.

• customer segmentation allows marketers to better tailor their marketing efforts to various audience subsets in terms of promotional, marketing, and product development strategies.

• Using the above data companies can then outperform the competition by developing uniquely appealing products and services.