PGP13047 Athena Chowdhury 11th July, 2023

BA Assignment

Cluster Analysis for Segmentation

Analyzing data that has been grouped based on similarities and differences is a process known
as cluster analysis. An assortment of related data is referred to as a cluster. Data points are
grouped in a process called clustering when they are comparable to one another. When a
cluster is described as homogenous, it means that the data within it are remarkably similar or
same. The two clusters are said to be heterogeneous when compared to one another, which
denotes that the data in the two clusters differ.

In order to arrange data so that objects in the same cluster are more similar to one another than
objects in separate clusters, cluster analysis is mostly used.

Using cluster analysis to produce clustering segments has a number of advantages. A few of
these are:

• To locate collections of related things, cluster analysis can be utilized. Targeting

particular consumer groups with this information will help marketing initiatives.

• Data dimensionality can be decreased through cluster analysis. Data visualization and
interpretation may become simpler as a result.

• Finding groupings of things that are unrelated to one another can be done via cluster
analysis. Then, this data can be utilized to locate prospective new markets or concentrate
marketing efforts on particular demographics.

• Cluster analysis is a versatile tool that can enhance marketing initiatives in a number of
ways.
Solution: