Machine Learning Project Report

Customer Segmentation
(using K-Means clustering method)

Author: Sneha Barman

Date: 8th September, 2023

Introduction:
This project aimed to create a customer segmentation model using machine learning
techniques to group customers into distinct segments based on their behavior and
characteristics. The project utilized a dataset containing customer data and
transaction history. The primary objective was to derive actionable insights for
marketing and business strategies.

Problem Statement:
Customer segmentation is a critical task for businesses seeking to tailor their
products, services, and marketing efforts to specific customer groups. This project
addressed this challenge using machine learning techniques to automatically classify
customers into meaningful segments.

Data:
The dataset used in this project included customer attributes such as demographics,
purchase history, and behavioural data. Data preprocessing steps were applied to
handle missing values, normalize features, and encode categorical variables. The data
was taken from Kaggle, the link is attached herewith.

https://www.kaggle.com/datasets/vjchoudhary7/customer-segmentation-tutorial-in-
python-Ye7dtpDTlFceHVfa%2Fview%3Fusp%3Ddrivesdk&v=fiz1ORTBGpY

Results and Discussion:

The model segregates the customers according to their Annual Income and
Spending Score with the help of a scatter plot, to a good precision.

References:
Help from YouTube video:
https://youtu.be/SrY0sTJchHE?si=1XBxqsTjvhxRtkAe