What Is A Cluster Analysis?

Written by Indicative Team


Cluster Analysis Defined

Cluster analysis is the technique of classifying a set of objects or cases into relative groups called clusters. Cluster analysis maximises the similarity of cases within each cluster while maximizing the dissimilarity between groups that are initially unknown. 

Cluster analysis is a common task in exploratory data mining and statistical data analysis.

There are two types of clusters:

  • Hard Clustering: each data point either belongs to a cluster completely or not. 
  • Soft Clustering: instead of putting each data point into a separate cluster, a probability or likelihood of that data point to be in those clusters is assigned.

 There are many applications of clustering a business can undertake:

  • Market Segmentation
  • Information Retrieval 
  • Image Segmentation
  • Shopping Behavior
  • Customer Retention

In Data Defined, we help make the complex world of data more accessible by explaining some of the most complex aspects of the field.

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