Jurnal Teknik Informatika (JUTIF)
Vol. 5 No. 2 (2024): JUTIF Volume 5, Number 2, April 2024

CUSTOMER LOYALTY SEGMENTATION IN ONLINE STORE USING LRFM AND MLRFM IN COMBINATION WITH RM K-MEANS ALGORITHM

Utomo, Angelina Caroline (Unknown)
Handojo, Andreas (Unknown)
Octavia, Tanti (Unknown)



Article Info

Publish Date
15 Apr 2024

Abstract

The rapid development of online business in recent years has driven Store X to embark on a digital transformation. By the end of 2020, Store X relocate their conventional business to online business. The greatest obstacle and key to success for online business operators, such as Store X, is gaining and retaining consumer loyalty in the face of an increasing number of competitors. Therefore, the company must be able to identify the character (behavior) of its clients to provide appropriate treatment. Each customer's behavior is unique, which means they must all be treated differently. However, all this time, Online Store X has provided the same treatment (as much of a discount) to all its customers due to the lack of information regarding their customers’ characteristics. Therefore, in this study, customers of Online Store X were segmented based on their transactional behavior using online transaction history data from March 2021 to March 2023. Two customer analysis models, LRFM and MLRFM, will be combined with RM K-Means to find the best combination through Silhouette Coefficient values. The optimal number of clusters (k) is then determined using the Elbow Method. The results indicate that the optimal number of clusters for both combinations is K=3, with the combination of MLRFM and RM K-Means is the best combination. The finest combination has a silhouette coefficient value of 0.8609. Based on this combination, it is also known that 2,053 customers in cluster 3 are loyal customers, while 2,339 customers in cluster 1 and 2 are lost customers. The results of this study were also implemented on websites built for X Store using Python programming languages and MySQL databases, making it easier for companies to see data visualization.

Copyrights © 2024






Journal Info

Abbrev

jurnal

Publisher

Subject

Computer Science & IT

Description

Jurnal Teknik Informatika (JUTIF) is an Indonesian national journal, publishes high-quality research papers in the broad field of Informatics, Information Systems and Computer Science, which encompasses software engineering, information system development, computer systems, computer network, ...