Microsoft Azure AI Fundamentals (AI-900) Practice Exam

For segmenting customers into varied groups for a marketing initiative, which machine learning technique is applicable?

1. Regression

2. Classification

3. Clustering

4. Time series analysis

The correct answer is: Clustering

Clustering is the appropriate machine learning technique for segmenting customers into varied groups for a marketing initiative. This method is specifically designed to group similar data points together based on certain characteristics or features without predefined labels. In the context of marketing, clustering helps businesses identify distinct groups of customers who share similar behaviors, preferences, or attributes, allowing for more targeted marketing strategies. By applying clustering algorithms, such as K-means or hierarchical clustering, businesses can effectively analyze customer data and discover natural groupings. For instance, a company might segment its customers by demographics, purchasing habits, or engagement levels, facilitating personalized marketing efforts that resonate better with each group. In contrast, other techniques like regression and classification focus on predicting continuous values or assigning labels to data points based on certain features, respectively, and are not suited for the purpose of grouping customers. Time series analysis is used to analyze data points collected or recorded at specific time intervals, which is not relevant when the goal is simply to segment customers.