Artificial Neural Networks in Customer Segmentation

Şükrü Ozan · Leonardo O. Iheme

21 citations0/0 files storedSignal Processing and Communications Applications Conference (SIU)

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Customer churn and segmentation Customer Service Quality and Loyalty Data Mining and Machine Learning Applications

Abstract

Customer segmentation is an important method both in customer relationship management literature and software since it directly relates with customer satisfaction of the companies. The most common way to separate customers into two distinct groups is to tag a group of customers with a special label. In this study, our company's likely segmented customer data and related statistical data are used to train and test a neural network based machine learning model, namely Multi layer Perceptron (MLP). Once the related features are tailored for artificial neural network training and the hyper parameters are tuned accordingly by deploying an extensive grid search algorithm, the system achieved a good generalization of our customer segmentation strategy and hence a good overall accuracy within a few epochs. The proposed system can be integrated to our company's data framework such that it can frequently analyze the customer related data tables and can decide whether a customer is to be promoted or is to remain unchanged. This automatic decision mechanism can improve our company's customer satisfaction.

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References

2016Customer portfolio management (CPM) for improved customer relationship management (CRM): Are your customers platinum, gold, silver, or bronze?2016Identifying the right solution customers: A managerial methodology 2018A Case Study on Customer Segmentation by using Machine Learning Methods

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2020A literature review of the current applications of machine learning and their practical implications 2020Case studies on using natural language processing techniques in customer relationship management software 2022Customer Segmentation in the Field of Marketing 2022Customer Segmentation and Future Purchase Prediction using RFM measures 2023Imperative role of customer segmentation technique for customer retention using machine learning techniques

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