Implementing Customer Segmentation Using Machine Learning

• Python
• Machine Learning

Customer Segmentation is the process of division of customer base into several groups of individuals that share a similarity in different ways that are relevant to marketing such as gender, age, interests, and miscellaneous spending habits. Companies that deploy customer segmentation are under the notion that every customer has different requirements and require a specific marketing effort to address them appropriately. Companies aim to gain a deeper approach of the customer they are targeting. Therefore, their aim has to be specific and should be tailored to address the requirements of each and every individual customer. Furthermore, through the data collected, companies can gain a deeper understanding of customer preferences as well as the requirements for discovering valuable segments that would reap them maximum profit. This way, they can strategize their marketing techniques more efficiently and minimize the possibility of risk to their investment. The technique of customer segmentation is dependent on several key differentiators that divide customers into groups to be targeted. Data related to demographics, geography, economic status as well as behavioral patterns play a crucial role in determining the company direction towards addressing the various segments.