Binary Classification of Customer’s Online Purchasing Behavior Using Machine Learning

Abstract

The UK financial sector increasingly employs machine learning techniques to enhance revenue and understand customer behaviour. In this study, we develop a machine learning workflow for high classification accuracy and improved prediction confidence using a binary classification approach on a publicly available dataset from a Portuguese financial institution as a proof of concept. Our methodology includes data analysis, transformation, training, and testing machine learning classifiers such as Naïve Bayes, Decision Trees, Random Forests, Support Vector Machines, Logistic Regression, Artificial Neural Networks, AdaBoost, and Gradient Descent. We use stratified k-folding (k=5) cross-validation and assemble the top-performing classifiers into a decision-making committee, resulting in over 92% accuracy with two-thirds voting confidence. The workflow is simple, adaptable, and suitable for UK banks, demonstrating the potential for practical implementation and data privacy. Future work will extend our approach to UK banks, reformulate the problem as a multiclass classification, and introduce pre-training automated steps for data analysis and transformation.