Cluster Analysis Motivation, Theory & Practical Application

Course details

1. About the course - Cluster analysis is one of the most popular techniques used in data mining for marketing needs. The idea behind cluster analysis is to find natural groups within data in such a way that each element in the group is as similar to each other as possible. At the same time, the groups are as dissimilar to other groups as possible.
2. Course materials- The course contains video presentations (power point presentations with voice), pdf, excel work book and sas codes.
3. Course duration- The course should take roughly 7 hours to understand and internalize the concepts.
4. Course Structure (contents) The structure of the course is as follows.

Motivation –

• Where one applies cluster analysis. Why one should learn cluster analysis?
• How it is different from objective segmentation (CHAID / CART )

Statistical foundation and practical application: Understand

• Different type of cluster analysis
• Cluster Analysis – high level view
• Hierarchical clustering –
  • Agglomerative or Divisive technique
  • Dendogram – What it is? What does it show?
  • Scree plot - How to decide about number of clusters
  • How to use SAS command to run hierarchical clustering
  • When and why does on need to standardize the data?
  • How to understand and interpret the output
• Non-hierarchical clustering (K means clustering).
  
  • Why do we need k means approach
  • How does it work?
  • How does it iterate?
  • How does it decide about combining old clusters?
  • How to use SAS command to run hierarchical clustering
  • When and why does on need to standardize the data?
  • How to understand and interpret the output