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Sipayung, Sardo Pardingotan
Universias Katolik Santo Thomas Medan Jl. Setiabudi No. 479 F Tanjungsari Medan
Humanities Chemical Engineering, Chemistry & Bioengineering Civil Engineering, Building, Construction & Architecture Computer Science & IT Control & Systems Engineering Decision Sciences, Operations Research & Management Economics, Econometrics & Finance Education Electrical & Electronics Engineering Engineering Environmental Science Industrial & Manufacturing Engineering Law, Crime, Criminology & Criminal Justice Library & Information Science Mathematics Medicine & Pharmacology Physics Public Health Social Sciences Transportation Other

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Journal : Journal of Digital Business and Data Science

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Implementation of Data Mining for Customer Segmentation Using the K Means Clustering Algorithm Based on Annual Income and Spending Score Lumban Gaol, Fortina; Sipayung, Sardo Pardingotan
Journal of Digital Business and Data Science Vol. 3 No. 1 (2026): Journal of Digital Business And Data Science
Publisher : Politeknik Siber Cerdika Internasional

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.59261/jdbs.v3i1.28

Abstract

Background: This research is motivated by the dynamics of the retail industry, which requires a deep understanding of consumer behavior in order to compete effectively in an increasingly competitive market. Many marketing strategies fail to achieve optimal results because they overlook variations in individual shopping behavior within large customer populations. Understanding these behavioral differences is important for developing more targeted and effective marketing strategies. Objective: This study aims to group customers into homogeneous segments in order to support more precise strategic decision-making in marketing activities. Method: The study applies a data mining approach using the K-Means clustering algorithm to analyze a dataset consisting of 200 customers. The clustering process is conducted based on two main variables, namely annual income and spending score, to identify patterns of consumer behavior. Findings and Implications: The results reveal five distinct consumer clusters with different behavioral characteristics. The Target group represents the majority with 81 customers, followed by the Sultan group (39 customers), the Thrifty group (35 customers), the Passive group (23 customers), and the Impulsive group (22 customers). The findings indicate that income level does not always correlate linearly with consumption intensity, implying that behavioral-based segmentation provides more accurate insights for marketing strategy development. Conclusion: Customer segmentation using the K-Means clustering algorithm enables clearer identification of target markets through well-defined cluster separation. Therefore, marketing strategies should emphasize lifestyle orientation rather than focusing solely on purchasing power to optimize customer loyalty and engagement.
Co-Authors Ade Linhar P Alex Rikki Andreas, Kevin Antonius Siagian, Novriadi Baehaqi Barus, Paskalia Br Batubara, Muhammad Iqbal Br Ginting, Anirma Kandida Cristina Situmorang Efendi, Syahril Fernando, Juniko Frans Steven Pakpahan Frans, Paulina Gorat Gaol, Sasmita Lumban Garingging, Cesia Trisani Saragih Ginting, Anirma Ginting, Anirma Kandinda Giovani, Aritonang Girsang, Jahanra Gracia Simatupang Gulo, Jelita Astrid Harianja, Andy Paul Hasugian , Paska Marto Hia, Hikmat Pengertian Hulu, Setiani Hutauruk, Amelia Sanna Maria Lahagu, Marlinus Lahagu, Nicolas Elsada Lase, Marsindra Yanti Limbeng, Yuni br Lubis, Maria Angelina Lumban Gaol, Fortina Lumbanbatu, Noperla Anjelisari LumbanBatu, Vio Br Maha, Yadi Limanta Mahyuddin K. M Nasution Manalu, Ester Manurung, Evaldo Manurung, Saut Maria Angelina Lubis Marmata, Sri Ulina Br Maruwahal Sijabat, Ramson Rikson Matondang, Zekson Aizona Meri Nova Marito Br Sipahutar Naibaho, Marcel Naibaho, Wirma Nainggolan, Kevin Marcho Napitupulu, Virzinia Nunes, Minaldinu Deyesus Panggabean, Jusnan Pasaribu, Adri Purba, Ade Purba, Jhonatan Purba, Marta Rahmawati Rajagukguk, Jonatan Carlos riang, rya Ricardo, Erich Ritonga, Margan Rizkiano Sagala, Lauren Patricia Sagala, Masdiana Saragih, Dea Ananda Sembiiring, Dia Alemisa br Sembiring, Boy Mountavani Sembiring, Brema Aprilta Sembiring, Dessianna Natalia Siagian, Novriadi Antonius Sianturi, Firman Torino SIBURIAN, MANANDA TURE Sihombing, Carlo Poda Boromeo Sihotang, Yuli Pitriani Br Silaban, Daniel Silalahi, Rasit Junaedi Simanjuntak, Richard Parlindungan Simanjuntak, Theresya Simbolon, Agustina Simbolon, Cantriya Simbolon, Daniel S. Simbolon, Yoel Sinaga, Elvis Lavenius sinaga, lotar mateus Sinaga, Rafael Grealdi Sirait, Juan Sebastian Siringoringo, Maysya Faiftin Sitanggang, Armando Agasi Sitanggang, Romualda Sitanggang, Roni Gabe Situmorang, Cristina Situmorang, Yudi Yohannes Sorang Pakpahan Surbakti, Efrans Tambunan, Dwito Julian Tambunan, Yosua Tampubolon, Albert Julio Tampubolon, Amsal Tarigan, Jenheri Rejeki TONNI LIMBONG Tulus Pramita Sihaloho Zakarias Situmorang Zebua, Wilfred Raimond Zekson Matondang