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Profitability and Accuracy in Market Segmentation Typing Tools

May 5, 2022
10:00 am
Methodological

Market segmentation usually includes a typing tool that predicts who falls in which segment: vital for a successful implementation. Using commercial real-life datasets, we compare support vector machines and neural nets against a common approach in commercial practice: linear discriminant analysis. We show that ML approaches yield superior performance in terms of segment-level prediction, interpretability and expected profitability.

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