Summary

In this chapter, we applied the Elbow and K-means functions to find the optimal number of groups and segments for two and three variables. Once we obtained the results, we did a business intelligence analysis using pivot tables and charts. In the product sales example developed in this chapter, we used segmentation to find the groups that generated higher revenues and what quantity of items were delivered. Grouping helps to achieve the target of selling smaller quantities of products to avoid logistics costs. The four variables segmentation analysis showed that the group with the highest revenue was not the group delivering more items, nor was it the most expensive in terms of shipping costs. Multivariable K-means segmentation helps to do this complex analysis, which would be impossible with just business intelligence and pivot tables and charts. In this chapter, you learned to combine different variables with different units, such as quantity and profit, to research which...