Here is what you need to know about clustering and profiling in CRM….
Clustering make use of three attributes in order to categorize customers and decide whether they are profitable or not. It is always based on the principle of Recency, Frequency and Monetary behavior of customers. This is sometimes referred to as the Wallet Shares of customers. That is the fraction of their earning that they are willing to spend on your products or services.
Clustering algorithm assign customers to different categories based on attributes that they have in common. This will help customer centric enterprise to come up with programs aimed at raising exit barrier for customers.
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