An Enhanced RFM Customer Value-Based Customer Segmentation and Evaluation
摘要
Machine Learning Algorithms are widely used in the contemporary era of highly compatible technical improvements to provide answers to the challenges of business environment, yet crucial services for a firm to run successfully in this intensely competitive E-commerce sector. Recently, strategies like clustering and classification mechanisms that allow for the classification of both existing and new clients into clusters have also produced positive outcomes. Recency, Frequency, and Monetary (RFM) measures are hugely being used these days to perform these kinds of tasks. In this study, individual one-dimensional clustering on the Recency, Frequency, and Monetary columns was performed, and a weighted average or preferred linear combination of the three features was then used to calculate an overall score. Summing up the result of three individual clusters. Finally, all of the distinct clients were divided into these three segments based on the overall score, which was divided into three categories.