Category: Fundamentals
Definition
Clustering groups similar data points together without knowing the categories beforehand.
How It Works
AI analyzes data characteristics and puts similar items in the same group. Customer data might cluster into groups like "frequent buyers," "price-sensitive shoppers," and "luxury seekers" based on purchasing patterns.
The AI finds these groups automatically without being told what to look for.
Why It Matters
Clustering reveals hidden patterns in data. Companies use it to segment customers, researchers use it to classify genes, and marketers use it to target audiences.
It's a key tool for exploring data when you don't know what categories exist.
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