A SOM-Based Customer Stratification Model

Abstract

This paper used the SOM in combination of the optimized RFM for customer stratification, to develop targeted marketing strategies for enterprises. In this paper, customers were grouped into four categories, including core customers, opportunistic customers, service drain customers, and marginal customers, using the customer consumption data of a retail enterprise by SOM, a clustering algorithm based on neural networks, in combination with the optimized RFM from the perspective of machine learning. The value of customers in different categories was determined based on their typical features for a visualized analysis, to develop targeted marketing strategies for enterprises.