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Customer segmentation plays a crucial role in
understanding consumer behavior, enabling businesses to tailor
their strategies to meet specific needs and preferences. This
paper explores the implementation of customer segmentation
using Agglomerative Clustering, a hierarchical clustering
method that groups data points based on their similarity in a
bottom-up approach, forming a dendrogram to visualize the
merging of clusters. By leveraging demographic and behavioral
attributes such as gender, marital status, age, education level,
profession, work experience, spending score, and family size,
this study categorizes customers into distinct clusters, providing
actionable insights for targeted marketing and personalized
services. The clustering process starts by treating each data
point as an individual cluster and iteratively merges the closest
clusters until a predefined number of clusters remain.
Agglomerative Clustering is particularly advantageous for its
flexibility in accommodating varied data distributions and its
ability to uncover hierarchical relationships within the dataset.
To enhance accessibility and real-time interaction, the research
integrates the clustering model with Gradio, a Python library
designed to create user-friendly web interfaces for machine
learning applications. Through the Gradio interface, users can
input customer attributes directly and receive immediate cluster
predictions, simplifying the deployment and usability of the
model. The system not only predicts cluster membership but
also provides an interpretative framework for understanding
customer groups, which are labeled based on their shared
characteristics to align with marketing strategies. For instance,
clusters might be categorized as high-spending professionals,
budget-conscious families, or young aspirational individuals,
each requiring tailored engagement approaches. The model
ensures accurate clustering by using the distance matrix to
measure the similarity between input data and computed cluster
centers, minimizing the error in classification. This integration
of Agglomerative Clustering and Gradio demonstrates how
machine learning and interactive tools can work synergistically
to enhance decision-making processes in business.
Keywords:
Cite Article:
"CUSTOMER SEGMENTATION USING AGGLOMERATIVE CLUSTERING ", International Journal of Science & Engineering Development Research (www.ijrti.org), ISSN:2455-2631, Vol.10, Issue 4, page no.a581-a590, April-2025, Available :http://www.ijrti.org/papers/IJRTI2504078.pdf
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2456-3315 | IMPACT FACTOR: 8.14 Calculated By Google Scholar| ESTD YEAR: 2016
An International Scholarly Open Access Journal, Peer-Reviewed, Refereed Journal Impact Factor 8.14 Calculate by Google Scholar and Semantic Scholar | AI-Powered Research Tool, Multidisciplinary, Monthly, Multilanguage Journal Indexing in All Major Database & Metadata, Citation Generator