K-Means Clustering
K-Means Clustering
How do you look at Customer segmentation? Say you have a lot of customers who are high spending customers and a lot of customers who are low spending customers buying your products. Now you want to offer a loyalty discount only to the low spending customers to get them to buy more of your product. What is the centre point of the high spenders and the centre point of the low spenders. If you took a straight average or mean you would be ignoring both customer bases.
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