Exam DA0-001 topic 1 question 11 discussion

CLUSTER not custer

D. Customer segmentation is the practice of dividing a customer base into smaller groups based on common characteristics such as demographics, buying behaviors, or psychographic traits. In this case, the analyst is looking at three characteristics: how recently a customer bought a product, how frequently they bought, and the value of their purchases. By grouping customers based on these characteristics, the company can tailor its promotional campaign to different segments, ensuring that the right message and offer is being communicated to the right people. Customer segmentation is considered a descriptive analysis, as it involves looking at the data and grouping it into meaningful categories. This type of analysis is often used in marketing and sales to better understand customer behavior and develop targeted strategies for customer engagement and retention. By using customer segmentation, companies can more effectively allocate their marketing resources and create more personalized experiences for their customers.

Customer segmentation is the process of dividing customers into groups based on shared characteristics, such as purchase history, frequency of purchases, and value of purchases. This type of analysis is often referred to as cluster analysis or clustering. Cluster analysis is a method of dividing a data set into groups (i.e., clusters) such that the data points within a cluster are more similar to each other than they are to data points in other clusters. The marketing department's request to look at how recently a customer bought a product, at what frequency, and at what value would be considered cluster analysis because it involves dividing customers into groups based on shared characteristics. The other options (prescriptive, trend, and gap) are not related to cluster analysis.