How can we identify potential customers for a new list of customers?

Question

I have two data sets:

Customer demographic data;
Transaction data of the customers.

Now, if I have to identify potential customers to develop a marketing strategy, I would make use of clustering to identify the similar groups and develop a marketing strategy accordingly.
How could I proceed to identify potential customers in a new list of customers not previously seem by the clustering algorithm? Is it like we apply the interpretations we observed from the clusters formed to the new customers??
Need some guidance on this.

prashant0598 · Answer

You are absolutely right. This method is called customer segmentation. Here we cluster customers based on many features like their demographic and income.
Suppose we get to know a particular set of people who belong to high income group/rich demographic are not spending much then we can do promotions to increase sales to get potential new customers hence it help drive business decision.
Having said that it's not best to run the algo once on past data and make decision as we know that customer behaviour changes frequently .So,companies usually run clustering algorithm daily to take advantage of the new customer behaviour.
So, to make our approach robust we need to find optimal no of clusters, choose best features hence it is a iterative process.
Refer this to know more.

How can we identify potential customers for a new list of customers?

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