Customer segmentation is the practice of dividing a company’s customers into groups that reflect similarity among customers in each group. The goal of segmenting customers is to decide how to relate to customers in each segment in order to maximize the value of each customer to the business.
Customer segmentation has the potential to allow marketers to address each customer in the most effective way. Using the large amount of data available on customers , a customer segmentation analysis allows marketers to identify discrete groups of customers with a high degree of accuracy based on demographic, behavioral and other indicators.
In this the dataset was taken from kaggle. It's called Mall_customers.csv
It contains information about the of customers shopping in a mall. We apply customer segmentation on the data in order to figure out the customer patterns and take business decisions accordingly.
The clustering algorithm divides the dataset into 5 clusters.