Question: How can K-means clustering be applied in market segmentation to enhance

marketing strategies and product offerings for a retail company?

Data:
A retail company collects data from its customer base, including demographic information (age,
gender, income), purchase history (products purchased, frequency, amount spent), and browsing
behavior (time spent on website, pages visited, items viewed).
Based on this dataset, the company aims to use K-means clustering to segment its customers into
distinct groups with similar characteristics and behaviors. By doing so, the company intends to tailor
its marketing strategies and product offerings to each segment more effectively.
The dataset includes a sample of 1000 customers with the following attributes:
Age (years)
Gender (Male/Female)
Annual Income (USD)
Total Number of Purchases
Total Amount Spent (USD)
Time Spent on Website (minutes)
Pages Visited
Items Viewed
Using K-means clustering, the company seeks to identify clusters of customers who exhibit similar
patterns in terms of their demographics, purchasing habits, and online behavior. These customer
segments will then inform targeted marketing campaigns, personalized promotions, and product
recommendations to enhance customer satisfaction and drive sales.

Total
Annual Time Spent
Customer Total Amount Pages Items
Age Gender Income on Website
ID Purchases Spent Visited Viewed
(USD) (minutes)
(USD)
1 35 Male 50000 8 600 40 15 10
2 45 Female 75000 12 1200 25 20 15
3 28 Male 40000 5 400 60 10 8
4 50 Female 100000 18 1800 35 25 20
5 40 Male 60000 10 800 45 18 12
6 32 Female 55000 7 550 55 12 9
7 55 Male 90000 15 1500 30 22 18
8 38 Female 65000 9 700 50 17 14
9 42 Male 80000 11 1000 40 20 16
10 48 Female 85000 14 1400 35 23 17