ANALYSIS AND PREDICTION OF CUSTOMER

SEGMENTATION USING BEHAVIORAL DATA

A project report submitted to Bharathiar University

in the partial fulfilment of the requirements for the award of the degree of

BACHELOR OF SCIENCE IN INFORMATION TECHNOLOGY

Submitted by

DEEPA .N (22UGIT013)
Under the Guidance of

MR. T. MARIA MAHAJAN M.C.A.,M.Phil.,

(ASSISTANT PROFESSOR)

Department of Information technology

NEHRU ARTS AND SCIENCE COLLEGE

(Autonomous)

(Reaccredited by NAAC with “A+” Grade, ISO 9001-2015& ISO 14001 : 2004
Certified)RECOGNIZED BY UGC & AFFILIATED TO BHARATHIAR
UNIVERSITY “NEHRU GARDENS”, T. M. PALAYAM, COIMBATORE –
641105.

MARCH 2025
 ANALYSIS AND PREDICTION OF CUSTOMER
SEGMENTATION USING BEHAVIORAL DATA

A project report submitted to Bharathiar University

in the partial fulfilment of the requirements for the award of the degree of

BACHELOR OF SCIENCE IN INFORMATIONTECHNOLOGY

Submitted by

DEEPA .N (22UGIT013)
Under the Guidance of

MR. T. MARIA MAHAJAN M.C.A.,M.Phil.,

(ASSISTANT PROFESSOR)

Department of Information technology

NEHRU ARTS AND SCIENCE COLLEGE

(Autonomous)

(Reaccredited by NAAC with “A+” Grade, ISO 9001-2015& ISO 14001 : 2004
Certified)RECOGNIZED BY UGC & AFFILIATED TO BHARATHIAR
UNIVERSITY “NEHRU GARDENS”, T. M. PALAYAM, COIMBATORE –
641105.

MARCH 2025
 DECLARATION
DECLARATION

I, DEEPA .N (22UGIT013) hereby declare that the Internship work entitled “Python
with Machine learning” submitted to Bharathiar University in partial fulfilment for the
award of the Bachelor Degree of Information Technology is an independent Project
report done by me during the Project duration of the period of study in Nehru Arts and
Science College, Coimbatore (Recognized by UGC &Affiliated to Bharathiar University)
under the guidance of MR. T. MARIA MAHAJAN during the academic year 2024-25.

Signature of the student

DEEPA N

PLACE : COIMBATOR

DATE:
 BONAFIDE CERTIFICATE

DEPARTMENT OF INFORMATION TECHNOLOGY

NEHRU ARTS AND SCIENCE COLLEGE

Affiliated to Bharathiar University Accredited with “A+”Grade by NAAC, ISO 9001:2015

(QMS) Certified, Recognized by UGC with 2(f) &12(B), Under Star College Scheme by DBT,
Govt. of India)Nehru Gardens, Thirumalayampalayam, Coimbatore-641105

CERTIFICATE

This is to certify that the Project report entitled “Customer segment: analysis and
prediction of customer segmentation using behavioral data” is a bonafied work done
by DEEPA N (22UGIT013) in partial fulfilment of the requirement of the award of the
degree of Bachelor of Science in Information technology, Bharathiar University, Coimbatore
during the academic year 2024-25

Internal Guide Head of the

Department

Certify that we examined the Candidate in the Internship Work / Viva -Voce Examination
held at NEHRU ARTS AND SCIENCE COLLEGE on
__________________________
Internal Examiner External
Examiner
COMPANY CERTIFICATE
COMPANY CERTIFICATE

9
ACKNOWLEDGEMENT

10
 ACKNOWLEDGEMENT

I solemnly take this opportunity to all the helping hands that made me accomplish this
project. First and foremost, I thank the Almighty who is the source of knowledge and one
who guided me for completing the project work successfully.

I sincerely thank our respected CEO & Secretary, Adv. Dr. P. KRISHNAKUMAR M.A.,
M.B.A., Ph.D., for his invaluable support and for providing the best academic environment to
undertake this project as part of the curriculum

I sincerely thank our respected Principal Dr. B. ANIRUDHAN M.A., B.Ed., M.Phil., Ph.D.
Nehru Arts and Science College for permitting me to undertake this project work as a part of
curriculum and for giving me the best facilities and infrastructure for the completion of the
course and project.

My sincere gratitude to our Dean Dr. K. SELVAVINAYAKI M.C.A, M. Phil., Ph.D. for her
support and guidance to complete the project work successfully.

My sincere thanks to Dr. J. MARIA SHYLA M.C.A, M. Phil., Ph.D. Head of the
Department,
for her support and the motivation to complete the project work successfully.

My immense gratitude to my guide, Mr. T. MARIA MAHAJAN M.C.A., M. Phil. for her
continuous support, encouragement and the guidance to complete the project work successfully.

I express my sincere words of gratitude to our department staff members for their motivation to
complete the project work successfully.

I extend my sincere thanks to my parents all my friends for their moral support rendered to
complete the project work in a grand success.

DEEPA N

11
 ABSTRACT

Customer segmentation is a separation of a market into multiple distinctgroups of consumers

who share the similar characteristics. Segmentation of market is an effective way to define and
meet customer needs. Unsupervised Machine Learning technique K-Means Clustering Algorithm
is used to performMarket Basket Analysis. Market Basket Analysis is carried out to predict
thetarget customers who can be easily converged, among all the customers. Inorder to allow the
marketing team to plan the strategy to market the new products to the target customers which are
similar to their interests.

This study focuses on customer segmentation analysis and the prediction of future segmentation
using behavioral data. The analysis leverages various data mining and machine learning
techniques to identify patterns and trends within customer interactions, purchase behaviors, and
engagement metrics.

Effective customer segmentation enables businesses to understand diverse customer needs,

optimize marketing strategies, and improve customer engagement.This research explores the use
of behavioral data for customer segmentation and the prediction of future segment dynamics. By
analyzing historical transactional, interaction, and engagement data, we apply advanced machine
learning techniques, including unsupervised clustering algorithms

The results provide valuable insights into customer preferences, enabling companies to
implement targeted marketing strategies, improve customer retention, and enhance overall
customer satisfaction.

This approach not only improves customer targeting but also allows businesses to anticipate
shifts in customer behavior and adapt proactively to changing market dynamics.

In conclusion, this study demonstrates the significant potential of utilizing behavioral data for
effective customer segmentation and predictive analysis. By applying advanced machine
learning algorithms, we successfully identified distinct customer groups based on their
behavioral patterns, providing valuable insights into customer preferences and tendencies.

Key words:

Target Customers, Clusters, Segmentation, Market Basket Analysis

TABLE OF CONTENT

12
S.No Contents Page.No

BONOFIDE CERTIFICATE

ACKNOWLEDGEMENT

DECLARATION

CERTIFICATE FROM ORGANIZATION

ABSTRACT

01 INTRODUCTION

02 SYSTEM REQUIREMENTS

03 SYSTEM STUDY

3.1 EXISTING SYSTEM

3.2 PROPOSED SYSTEM

04 SYSTEM DESIGN

4.1 MODULES

4.2 DATAFLOW DIAGRAM

13
 4.3 DATASET DESIGN

4.4 INPUT DESIGN

4.5 OUTPUT DESIGN

05 PROGRAM SPECIFICATION

5.1 PYTHON

5.1.1 PYTHON FEATURES

5.1.2 PYTHON PACKAGE

5.2 PYTHON FILES I/O

5.2.1 CLASS AND OBJECTS

5.2.2 PYTHON LIBRARIES

5.2.3 INSTALLATION

06 FEASABILITY STUDY

14
 6.1 FEASABILITY ANALYSIS

07 SYSTEM TESTING

7.1 UNIT TESTING

7.2 BLACK BOX TESTING

7.3 WHITE BOX TESTING

7.4 INTEGRATION TESTING

7.5 VALIDATION TESTING

08 CONCLUSION AND FUTURE ENHANCEMENT

09 BIBLIOGRAPHY

10 SAMPLE CODE

10.1 OUTPUT

15
16
 01. INTRODUCTION

The detection and classification of underwater objects, such as submarine rocks and naval
mines, is a critical challenge in maritime security and defense. Accurate identification of
these objects is essential to prevent accidents, protect naval assets, and ensure safe
navigation in underwater environments. Traditional detection methods, relying on sonar
and acoustic signals, often face limitations in distinguishing between natural geological
formations and man-made threats, leading to false alarms and inefficiencies.

This research focuses on a novel approach to differentiate between submarine rocks

and naval mines using machine learning techniques. By analyzing acoustic and sonar data,
the study leverages advanced machine learning algorithms, such as deep neural networks,
to accurately classify underwater objects based on their unique acoustic signatures. The
goal is to enhance detection accuracy, reduce false positives, and improve real-time
decision-making for naval forces and maritime security agencies. Through this innovative
method, the research aims to provide more effective solutions for underwater object
classification, contributing to both defense capabilities and the protection of marine
environments.

More generally, data-driven decision making is way for businesses to make sure their
next move will benefit both them and their customers. Almost every company, especially in
the Tech ecosystem has now put into place a tracking process, to gather data related to
their customers’ behavior. The data to track varies along with the specific business model
of each company and the problem service they aim to address. By analyzing how, when and
why customers behave a certain way, it is possible to predict their next steps and have time
to work on fixing issues beforehand.

Churn prediction is the activity of trying to predict the phenomena of loss of customers.
This prediction and quantification of the risk of losing customers can be done globally or
individually and is mainly used in areas where the product or service is marketed on a
subscription basis. The prediction of churn is generally done by studying consumer
behaviour or by observing individual behaviour that indicates a risk of attrition. It involves
the use of modelling and machine learning techniques that can sometimes use a
considerable amount of data.

These behaviours can be :

• variations in consumption or usage behaviour
• a change to inactive client status or a drop in service usage
• the formulation of a claim (number, frequency and types of claims)
• an increase in consumption leading to a sharp rise in the bill

17
1.1 Context and Terminology :

Aircall is a SaaS (Software As A Service) B2B company on a mission to redefine the

business phone. It is an advanced, cloud-based business phone system and call center
software, all wrapped up in a single tool. Aircall’s customer base consists in almost 5000
international small businesses and start-ups, which represent the customers. All those
customers can add how many users they need to their account and assign them to one or
more phone numbers. When the customers subscribe to the service, they choose between
several pricing plans, that each propose a price per user added. The main specificity and
competitive advantage of Aircall is that it can be connected to many other business tools so
that each customer can build their own custom workflows. The connection that is built by a
customer between its Aircall account and any other software that it uses is called an
integration. Each customer can create as many integrations as it wishes. The use of Aircall
with integrations is perceived as a generator of adherence to the product.

For now, product usage is not precisely tracked yet on the product side but a trend can be
highlighted by just having a look at the number of calls that are made by the customer
(inbound calls), received by the customer (outbound calls) and the number of integrations
they configured in their Aircall account, as well as the evolution of these metrics over time
for a given customer.

Finally, the customers can assess the quality of Aircall’s product and service by two
different means. First, a form is sent to each of their user every 3 months where they can
express how much they would recommend the product to someone (ranking from 0 to 10,
0 being the most negative answer). Depending on their grade, they are then qualified as
being either promoter (graded 9 or 10), detractor (from 0 to 6) or neutral. Aircall then
compute the Net Promoter Score (NPS ) which is calculated by subtracting the percentage
of customers who are Detractors from the percentage of customers who are Promoters. An
NPS can be as low as -100 (every respondent is a detractor) or as high as +100 (every
respondent is a promoter). The business teams at Aircall are divided into five groups: Sales,
Onboarding, Customer Success, Support and Marketing. They all have their importance at
different moment during customer lifetime. First, the Sales team is in charge of finding
potential clients, make sure they are qualified (meaning Aircall’s product could actually be
useful for them), and signing the deal. Once the targeted company has become a customer,
the Onboarding team has to help them configuring the product on their own system so that
they can have the best experience with it. From the time the company becomes a customer,
it becomes the responsibility of the Customer Success team. They are the point of contact
between Aircall and their

customers, and are the key stakeholder when talking about hurn. Indeed, their job is split
into trying to upgrade the customers to a better plan, or having it adding more users, and
preventing them from churning. Finally, the Support team is the point of contact for any

18
kind of technical issues. They can be reached to through tickets, chat or phone. Aircall’s
customers are divided into two distinct categories depending on how much they bring to
the company. The ones that represent more than $1K of monthly recurring revenue are
defined as VIP accounts, and the other ones as Mid-Market accounts. VIP accounts
represent less than 10% of Aircall’s total number of customers but 50% of total monthly
recurring revenue and they are assigned to 70% of the Customer Success team. All these
accounts are carefully cared about so the Customer Success team successfully manage to
prevent their churn. On the contrary, there are too many Mid-Markets accounts, and too
little Customer Success Managers to handle their churn. Human resources are too limited
to conduct this work which is why the company decided to invest in some Data Analysis
and Machine Learning to get insights about the Mid-Market accounts, and give those
information to Customer Success Managers so that they can contact the sensitive
customers before they leave.

02. SYSTEM SPECIFICATION

1.2.1 HARDWARE CONFIGURATION :

● Processor : Intel Core i3

● RAM Capacity : 4 GB

● Hard Disk : 90 GB

● Mouse : Logical Optical Mouse

● Keyboard : Logitech 107 Keys

● Monitor : 15.6 inch

● Mother Board : Intel

● Speed : 3.3GHZ

1.2.2 SOFTWARE CONFIGURATION:

19
 ● Operating System : Windows 10

● Front End : PYTHON

● Middle Ware : ANACONDA (JUPYTER NOTEBOOK)

● Back End : Python

03. SYSTEM STUDY

System study contains existing and proposed system details. Existing system is useful to
develop proposed system. To elicit the requirements of the system and to identify the
elements, Inputs, Outputs, subsystems and the procedures, the existing system had to be
examined and analysed in detail.

This increases the total productivity. The use of paper files is avoided and all the data are
efficiently manipulated by the system. It also reduces the space needed to store the larger
paper files and records.

3.1 EXISTING SYSTEM:

● The prototype developed was a smart device thatcollected inputs at the end of the
day's business directly from sales datarecords and automatically modified
segmentation statistics.

● An ANOVAanalysis was also performed to test the cluster's stability. The actual sales
figures of the day to day are contrasted with the model's expected statistics.

● The findings were positive and demonstrated a high degree of precision.

20
3.2 PROPOSED SYSTEM:

● We proposed to use K-means technique for customer segmentation. Our solution is

segmenting the customers based on information analytics. Consumers can be
divided into groups in relation to common behaviours they share.

● Such behaviours link to their knowledge of, attitude toward, use of, or spending
score or response to a product.

● We used machine learning Clustering algorithm K-Means for this customer

segmentation.

04. SYSTEM DESIGN

The degree of interest in each concept has varied over the year, each has stood the test of
time. Each provides the software designer with a foundation from which more
sophisticated design methods can be applied. Fundamental design concepts provide the
necessary framework for “getting it right”.
During the design process the software requirements model is transformed into design
models that describe the details of the data structures, system architecture, interface, and
components. Each design product is reviewed for quality before moving to the next phase
of software development.

4.1 MODULES:

DESCRIPTION OF MODULES:

● Data Preprocessing
● Data Exploration
● Data Cleaning
● Data Modelling
● Feature Engineering

DATASET PREPROCESSING:

21
Data Processing

Flatten
tempora:

When

flattening the temporal data as described in the previous section, it is

important to still reflect their evolution compared to their values at the
extract month. For instance, the numerical features have been added by
computing the percentage of growth between month i − n and i. For
categorical features, the historical value reflects weather the value changed
between month i − n and i.

Categorical data:

The categorical variables are handled by creating dummy variables, where k

− 1 binary variables are created given a feature with k classes. The created
number of dummies is one less than the number of classes in order to avoid
multicollinearity. Outliers
Machine learning algorithms are very sensitive to the range and distribution of data points.
Data outliers can deceive the training process resulting in longer training times and less
accurate models. The outliers were detected by looking at boxplots and performing
extreme value analysis. The key of extreme value analysis is to determine the statistical
tails of the underlying distribution of the variable and find the values at the extreme of the
tails. As the variables are not normally distributed, a general approach is to calculate the
quantiles and then inter-quartile range. If the data point is above the upper boundary or
below the lower boundary, it can be considered as an outlier. Because the studied data set
is already small, removing samples with outliers would waste even more data and is not

22
considered. Instead, the extreme value is replaced by the mean value, or most represented
value of the related feature.

DATA EXPLORATION:

Data exploration is an informative search used by data consumers to form true analysis
from the information gathered. Data exploration is used to analyse the data and
information from the data to form true analysis. After having a look at the dataset, certain
information about the data was explored. Here the dataset is not unique while collecting
the dataset. In this module, the uniqueness of the dataset can be created.

DATA CLEANING:

In data cleaning module, is used to detect and correct the inaccurate dataset. It is used to
remove the duplication of attributes. Data cleaning is used to correct the dirty data which
contains incomplete or outdated data, and the improper parsing of record fields from
disparate systems. It plays a significant part in building a model.

DATA MODELLING:

In data modelling module, the machine learning algorithms were used to predict the Wave
Direction. Linear regression and K-means algorithm were used to predict various kinds of
waves. The user provides the ML algorithm with a dataset that includes desired inputs and
outputs, and the algorithm finds a method to determine how to arrive at those results.
Linear regression algorithm is a supervised learning algorithm. It implements a statistical
model when relationships between the independent variables and the dependent variable
are almost linear, shows optimal results. This algorithm is used to show the direction of
waves and its height prediction with increased accuracy rate.
K-means algorithm is an unsupervised learning algorithm. It deals with the correlations
and relationships by analysing available data. This algorithm clusters the data and predict
the value of the dataset point. The train dataset is taken and are clustered using the
algorithm. The visualization of the clusters is plotted in the graph.

FEATURE ENGINEERING:

In the feature engineering module, the process of using the import data into machine
learning algorithms to predict the accurate directions. A feature is an attribute or property
shared by all the independent products on which the prediction is to be done. Any attribute
could be a feature, it is useful to the model.

4.2 DATAFLOW DIAGRAM

23
Data flow diagrams are used to graphically represent the flow of data in a business
information system. DFD describes the processes that are involved in a system to transfer
data from the input to the file storage and reports generation. Data flow diagrams can be
divided into logical and physical. The logical data flow diagram describes flow of data
through a system to perform certain functionality of a business. The physical data flow
diagram describes the implementation of the logical data flow.

DFD graphically representing the functions, or processes, which capture, manipulate, store,
and distribute data between a system and its environment and between components of a
system. The visual representation makes it a good communication tool between User and
System designer. The objective of a DFD is to show the scope and boundaries of a
system.The DFD is also called as a data flow graph or bubble chart. It can be manual,
automated, or a combination of both. It shows how data enters and leaves the system, what
changes the information, and where data is stored.

+-------------------+
| Customer Database |
+-------------------+
|
v
+-----------------------------+
| Data Collection & Integration|
+-----------------------------+
|
v
+-----------------------------+
| Data Preprocessing |
| (Cleaning & Transformation) |
+-----------------------------+
|
v
+-----------------------------+
| Customer Segmentation |

24
 | (Clustering: K-means, DBSCAN)|
+-----------------------------+
|
v
+-----------------------------+
| Prediction Modeling |
| (Churn, Purchase Likelihood)|
+-----------------------------+
|
v
+-----------------------------+
| Analysis & Insights |
| (Model Evaluation) |
+-----------------------------+
|
v
+-----------------------------+ +-------------------------+
| Reporting & Visualization | <----> | Business/Marketing Team |
| (Final Results, Recommendations) | (Strategic Decisions) |
+-----------------------------+ +-------------------------+
^
|
Insights & Reports

4.3 DATASET DESIGN:

This phase contains the attributes of the dataset which are maintained in the database
table. The dataset collection can be of two types namely train dataset and test dataset.

4.4 INPUT DESIGN:

● The design of input focus on controlling the amount of dataset as input required,

25
 avoiding

● delay and keeping the process simple. The input is designed in such a way to
provide security.

● Input design will consider the following steps:

● The dataset should be given as input.

● The dataset should be arranged.

● Methods for preparing input validations.

4.5 OUTPUT DESIGN:

● A quality output is one, which meets the requirement of the user and presents the
information clearly. In output design, it is determined how the information is to be
displayed for immediate need.

● Designing computer output should proceed in an organized, well thought out

manner the right output must be developed while ensuring that each output
element is designed so that the user will find the system can be used easily and
effectively

05. PROGRAM SPECIFICATION

5.1 PYTHON:
Python is an interpreted, object-oriented, high-level programming language with dynamic
semantics. Its high-level built in data structures, combined with dynamic typing and
dynamic binding, make it very attractive for Rapid Application Development, as well as for
use as a scripting or glue language to connect existing components together. Python's
simple, easy to learn syntax emphasizes readability and therefore reduces the cost of
program maintenance. Python supports modules and packages, which encourages program
modularity and code reuse. The Python interpreter and the extensive standard library are
available in source or binary form without charge for all major platforms, and can be freely
distributed.

26
5.1.1 PYTHON FEATURES :

Python has few keywords, simple structure, and a clearly defined syntax. Python code is
more clearly defined and visible to the eyes. Python's source code is fairly easy-to-
maintaining. Python's bulk of the library is very portable and cross-platform compatible on
UNIX, Windows, and Macintosh. Python has support for an interactive mode which allows
interactive testing and debugging of snippets of code.

Portable Python can run on a wide variety of hardware platforms and has the same
interface on all platforms.

● Extendable :It allows to add low-level modules to the Python interpreter. These
modules enable programmers to add to or customize their tools to be more efficient.

● Databases : Python provides interfaces to all major commercial databases

● GUI Programming :Python supports GUI applications that can be created and
ported to many system calls, libraries and windows systems, such as Windows MFC,
Macintosh, and the X Window system of Unix.

● Scalable :Python provides a better structure and support for large programs than
shell scripting.

● Object-Oriented Approach :One of the key aspects of Python is its object-oriented

approach. This basically means that Python recognizes the concept of class and
object encapsulation thus allowing programs to be efficient in the long run.

● Highly Dynamic : Python is one of the most dynamic languages available in the
industry today. There is no need to specify the type of the variable during coding,
thus saving time and increasing efficiency.

● Extensive Array of Libraries : Python comes inbuilt with many libraries that can
be imported at any instance and be used in a specific program.

● Open Source and Free :Python is an open-source programming language which

means that anyone can create and contribute to its development. Python is free to
download and use in any operating system, like Windows, Mac or Linux.

5.1.2 Packages in Python:

For customer segmentation analysis and prediction using behavioral data in Python,

27
several libraries and packages can help with clustering, classification, and analysis. Below
are some of the commonly used Python packages for this task:

1. Data Preprocessing and Analysis:

Pandas: For handling and manipulating data.

pip install pandas

Numpy: For numerical computations.

pip install numpy

Scikit-learn : For machine learning algorithms and data preprocessing.

pip install scikit-learn

Matplotlib / Seaborn: For data visualization and graphical analysis.

pip install matplotlib seaborn

SciPy: For advanced statistical analysis.

pip install scipy

2. Clustering Algorithms for Segmentation:

KMeans (Scikit-learn):

A popular clustering algorithm used for customer segmentation.

from sklearn.cluster import KMeans

DBSCAN (Scikit-learn):

For density-based clustering, useful when clusters have irregular shapes.

from sklearn.cluster import DBSCAN

AgglomerativeClustering (Scikit-learn):

A hierarchical clustering algorithm for customer segmentation.

from sklearn.cluster import AgglomerativeClustering
GaussianMixture (Scikit-learn):

For probabilistic clustering.

from sklearn.mixture import GaussianMixture

3. Dimensionality Reduction for Feature Engineering:

28
 ● PCA (Principal Component Analysis - Scikit-learn):

Useful for reducing high-dimensional behavioral data.

from sklearn.decomposition import PCA

● t-SNE (t-Distributed Stochastic Neighbor Embedding):

For visualizing high-dimensional data in 2D or 3D.

from sklearn.manifold import TSNE`

● UMAP (Uniform Manifold Approximation and Projection):

Another dimensionality reduction technique.

pip install umap-learn

4. LIBRARY FOR BUILDING PREDICTIVE MODEL:

● XGBoost:

A popular gradient boosting library for building predictive models.

pip install xgboost

● LightGBM:

Another gradient boosting framework that's highly efficient for prediction.

pip install lightgbm

● CatBoost:

A gradient boosting algorithm that is particularly good for categorical data.

pip install catboost`

● RandomForestClassifier (Scikit-learn):

For classification-based customer segmentation.

from sklearn.ensemble import RandomForestClassifier

5. Market Basket Analysis (For Behavior Analysis):

MLxtend:

For association rule mining (like Apriori algorithm) to discover patterns in

29
customer behavior.
pip install mlxtend

apyori:

For efficient association rule mining.

pip install apyori

6. Deep Learning Approaches:

TensorFlow / Keras:

For deep learning-based approaches to predict customer segmentation.

pip install tensorflow keras

PyTorch:

Another deep learning framework.

pip install torch torchvision

7. Customer Segmentation via Geospatial Data (if applicable):

Geopandas:

If customer data involves geospatial information (e.g., locations).

pip install geopandas

Folium:

For creating maps to visualize customer locations.

pip install folium

8. Time Series Analysis (if applicable):

Statsmodels:

For performing time series analysis and forecasting.

pip install statsmodels

Prophet:

A forecasting tool by Facebook, great for time-series prediction.

30
 pip install prophet

Example Workflow for Customer Segmentation:

1. Data Loading & Preprocessing:

Use Pandas for data manipulation and cleaning.

2. Feature Engineering:
Apply dimensionality reduction using PCAor t-SNE.

3. Segmentation:
Use KMeans or DBSCAN to cluster customers.

4. Modeling:
Apply predictive models like XGBoost or RandomForestClassifier to predict segments
based on behavioral data.

5. Visualization:

Use Matplotlib, Seaborn , or Plotly for visualizing the customer segments.

Sample Code for KMeans Clustering:

`python
import pandas as pd
from sklearn.cluster import KMeans
from sklearn.preprocessing import StandardScaler
import matplotlib.pyplot as plt

Load data
data = pd.read_csv('customer_data.csv')

Preprocessing: Scaling the data

scaler = StandardScaler()
scaled_data = scaler.fit_transform(data[['feature1', 'feature2', 'feature3']])

Apply KMeans clustering

kmeans = KMeans(n_clusters=3, random_state=42)
data['Cluster'] = kmeans.fit_predict(scaled_data)

Visualize the clusters

31
plt.scatter(data['feature1'], data['feature2'], c=data['Cluster'])
plt.xlabel('Feature 1')
plt.ylabel('Feature 2')
plt.title('Customer Segments')
plt.show()

5.2 PYTHON FILES I/O :

This chapter covers all the basic I/O functions available in Python.

PRINTING TO THE SCREEN:

Here is a Python script that demonstrates how to perform customer segmentation analysis
and prediction using behavioral data. It covers reading input data from a CSV file,
preprocessing the data, performing clustering (KMeans in this case), and saving the results
to an output CSV file.

Python Script: `customer_segmentation.py`

python
import pandas as pd
from sklearn.cluster import KMeans
from sklearn.preprocessing import StandardScaler
import matplotlib.pyplot as plt
from sklearn.decomposition import PCA

Load customer behavioral data from a CSV file

def load_data(file_path):
Load customer behavioral data from a CSV file.
try:

data = pd.read_csv(file_path)
print(f"Data loaded successfully from {file_path}")
return data

except FileNotFoundError:

print(f"Error: The file {file_path} was not found.")

return None

Preprocess the data (scaling)

def preprocess_data(data, features):
Scale the features of the data."""
scaler = StandardScaler()

32
scaled_data = scaler.fit_transform(data[features])
return scaled_data

Perform KMeans clustering

def perform_kmeans_clustering(data, num_clusters):
Perform KMeans clustering to segment customers.
kmeans = KMeans(n_clusters=num_clusters, random_state=42)
data['Cluster'] = kmeans.fit_predict(data)
return data, kmeans

Visualize the clusters (2D using PCA)

def visualize_clusters(data, features):
Visualize the customer clusters in a 2D space using PCA.
pca = PCA(n_components=2)
pca_components = pca.fit_transform(data[features])

plt.figure(figsize=(8, 6))
plt.scatter(pca_components[:, 0], pca_components[:, 1], c=data['Cluster'], cmap='viridis')
plt.xlabel('PCA Component 1')
plt.ylabel('PCA Component 2')
plt.title('Customer Segments')
plt.colorbar(label='Cluster')
plt.show()

Save the clustered data to a CSV file

def save_to_csv(data, output_file):
Save the customer segmentation results to a CSV file.

try:

data.to_csv(output_file, index=False)
print(f"Customer segmentation results saved to {output_file}")
except Exception as e:
print(f"Error saving file: {e}")

def main(input_file, output_file, features, num_clusters=3):

Main function to load data, perform segmentation, and save the results.
Load data
data = load_data(input_file)
if data is None:
return

Preprocess the data (scaling)

33
 scaled_data = preprocess_data(data, features)

Perform KMeans clustering

data, kmeans_model = perform_kmeans_clustering(data, num_clusters)

Visualize the clusters

visualize_clusters(data, features)

Save the segmented data with cluster labels to a new CSV file
save_to_csv(data, output_file)

if __name__ == "__main__":
# Define the input and output file paths
input_file = 'customer_data.csv' # Replace with the path to your input CSV file
output_file = 'customer_segmentation_results.csv' # Output file to save the results

Features used for segmentation (behavioral data columns)

features = ['feature1', 'feature2', 'feature3'] # Replace with your actual feature names

Perform customer segmentation analysis and save results

main(input_file, output_file, features)

Explanation of the Script:

1. Loading Data:

The `load_data` function loads the behavioral customer data from a CSV file using
`pandas.read_csv()`.
The file path is passed as an argument, and the function returns the loaded data.

2. Preprocessing Data:

The `preprocess_data` function scales the customer data using `StandardScaler` from
Scikit-learn to standardize the feature values.
Scaling ensures that the clustering algorithm (KMeans) doesn't give too much weight to
any one feature due to differences in magnitude.

3. Clustering:

The `perform_kmeans_clustering` function applies the KMeans algorithm from Scikit-learn

to segment customers into a predefined number of clusters (`num_clusters`).
The results are appended to the original data as a new column labeled "Cluster".

34
4. Visualization:

The `visualize_clusters` function uses PCA (Principal Component Analysis) to reduce the
dimensionality of the feature set to 2D, allowing the visualization of the clustering results
on a 2D plot.
The clusters are color-coded to easily distinguish between different segments.

5. Saving Results:

The `save_to_csv` function saves the segmented data (including the cluster labels) to a
new CSV file.

6. Main Function:

The `main` function is the driver that calls the other functions: loading the data,
preprocessing, clustering, visualizing, and saving the results to a file.
This script assumes the data has specific behavioral features (like `feature1`, `feature2`,
`feature3`). You'll need to modify these to match the actual columns in your dataset.

Running the Script:

To run the script, follow these steps:

1. Prepare the Dataset:

Ensure you have a CSV file (e.g., `customer_data.csv`) with behavioral data. The file should
include columns that represent customer features (e.g., purchase behavior, usage
frequency, etc.).

2. Modify the Features:

Replace `['feature1', 'feature2', 'feature3']` in the `features` variable with the actual column
names from your dataset.

3. Run the Script:

Save the script to a Python file, e.g., `customer_segmentation.py`.

Open a terminal/command prompt and run:
bash
python customer_segmentation.py

35
4. Results:

The customer data will be clustered into segments and saved as a new CSV file
(`customer_segmentation_results.csv`).
A 2D plot of the clusters will also be displayed.

Dependencies:
You will need to install the following Python libraries:

bash
pip install pandas scikit-learn matplotlib

5.2.1 CLASS AND OBJECTS :

To perform an analysis and prediction of customer segmentation using behavioral data,
you can define a class and objects for handling different aspects of the task. Here's a Python
example using a class structure that could be applied in such an analysis.

Step-by-step approach:

1. Class for Data Preprocessing: To handle the cleaning and preparation of the behavioral
data.
2. Class for Segmentation: To apply clustering techniques like K-Means or DBSCAN for
customer segmentation.
3. Class for Prediction: To train a machine learning model to predict the customer segments
based on the data.
4. Object to hold data: Represent data such as customer IDs, behaviors, and clusters.

Example Implementation in Python:

```python
import pandas as pd
from sklearn.cluster import KMeans
from sklearn.preprocessing import StandardScaler
from sklearn.model_selection import train_test_split
from sklearn.ensemble import RandomForestClassifier

# Data Preprocessing Class

class DataPreprocessing:
def __init__(self, data):
self.data = data

def clean_data(self):

36
 """Function to clean the data (e.g., handling missing values)."""
self.data.dropna(inplace=True) # Dropping missing values
return self.data

def feature_scaling(self):
"""Scale features for machine learning models."""
scaler = StandardScaler()
scaled_data = scaler.fit_transform(self.data)
return scaled_data

# Customer Segmentation Class

class CustomerSegmentation:
def __init__(self, data):
self.data = data
self.model = None
self.clusters = None

def apply_kmeans(self, n_clusters):

"""Use KMeans clustering for customer segmentation."""
kmeans = KMeans(n_clusters=n_clusters)
self.clusters = kmeans.fit_predict(self.data)
return self.clusters

def assign_clusters(self):
"""Add cluster labels to the original dataset."""
self.data['Cluster'] = self.clusters
return self.data

# Prediction Class
class CustomerPrediction:
def __init__(self, data, target):
self.data = data
self.target = target
self.model = None

def train_model(self):
"""Train a model to predict customer segments based on features."""
X = self.data.drop(columns=[self.target])
y = self.data[self.target]
X_train, X_test, y_train, y_test = train_test_split(X, y, test_size=0.3, random_state=42)

# Example using RandomForestClassifier

self.model = RandomForestClassifier(n_estimators=100)

37
 self.model.fit(X_train, y_train)

accuracy = self.model.score(X_test, y_test)

return accuracy

def predict_segment(self, new_data):

"""Predict the segment of a new customer."""
prediction = self.model.predict(new_data)
return prediction

# Example of using these classes:

# Sample data (this could be your behavioral dataset)

data = pd.DataFrame({
'Age': [22, 35, 58, 45, 25, 41, 50, 36, 28, 60],
'Income': [40000, 50000, 120000, 70000, 42000, 80000, 90000, 65000, 45000, 100000],
'Spending_Score': [60, 75, 90, 55, 65, 85, 70, 60, 80, 95]
})

# 1. Data Preprocessing
preprocessor = DataPreprocessing(data)
clean_data = preprocessor.clean_data()
scaled_data = preprocessor.feature_scaling()

# 2. Customer Segmentation
segmentation = CustomerSegmentation(scaled_data)
clusters = segmentation.apply_kmeans(n_clusters=3)
segmented_data = segmentation.assign_clusters()

# 3. Customer Prediction
predictor = CustomerPrediction(segmented_data, target='Cluster')
accuracy = predictor.train_model()
print(f"Model Accuracy: {accuracy * 100:.2f}%")

# Predicting segment for new customer

new_customer_data = [[0.25, 0.35, 0.45]] # Example new customer data (scaled)
predicted_segment = predictor.predict_segment(new_customer_data)
print(f"Predicted Customer Segment: {predicted_segment}")
```

Explanation:

1.

38
DataPreprocessing Class:

The `clean_data()` function handles missing values.

The `feature_scaling()` function scales the features for better
performance in models.

2. CustomerSegmentation Class:

The `apply_kmeans()` function applies the KMeans algorithm to segment customers based
on behavioral features (like Age, Income, Spending Score).
The `assign_clusters()` function adds the cluster labels to the dataset for further analysis.

3. CustomerPrediction Class:

The `train_model()` function splits the data into training and testing sets, then trains a
RandomForest model to predict customer segments based on the behavioral features.
The `predict_segment()` function predicts the customer segment for a new customer.

Workflow:

1. The customer behavioral data is preprocessed by cleaning and scaling.

2. KMeans clustering is applied to segment customers based on their behavior.
3. A predictive model (Random Forest) is trained to predict the segments.
4. The model can then be used to predict the segment of new customers.

You can modify the dataset and the clustering technique to fit your actual use case and
dataset.

Syntax :

Derived classes are declared much like their parent class; however, a list of base classes to
inherit from
is given after the class name −
class SubClassName (ParentClass1[, ParentClass2, ...]):
'Optional class documentation string'
class_suite
Overriding Methods
You can always override your parent class methods. One reason for overriding parent's methods
is
because you may want special or different functionality in your subclass.

39
Example :

class Parent: # define parent class

def myMethod(self):
print 'Calling parent method'
class Child(Parent): # define child class
def myMethod(self):
print 'Calling child method'
c = Child() # instance of child
c.myMethod() # child calls overridden method
When the above code is executed, it produces the following result −
Calling child method
Base Overloading Methods
Following table lists some generic functionality that you can override in your
own classes −
SN Method, Description & Sample Call
1 __init__ ( self [,args...] )
Constructor (with any optional arguments)
Sample Call : obj = className(args)
2 __del__( self )
Destructor, deletes an object
Sample Call : del obj
3 __repr__( self )
Evaluatable string representation
Sample Call : repr(obj)
4 __str__( self )
Printable string representation
Sample Call : str(obj)
5 __cmp__ ( self, x )
Object comparison
Sample Call : cmp(obj, x)
Overloading Operators
Suppose you have created a Vector class to represent two-dimensional vectors, what happens
when you
use the plus operator to add them? Most likely Python will yell at you.
You could, however, define the __add__ method in your class to perform vector addition and
then the
plus operator would behave as per expectation −
class Vector:
def __init__(self, a, b):
self.a = a
self.b = b
def __str__(self):
return 'Vector (%d, %d)' % (self.a, self.b)

def __add__(self,other):
return Vector(self.a + other.a, self.b + other.b)
v1 = Vector(2,10)
v2 = Vector(5,-2)
print v1 + v2

40
When the above code is executed, it produces the following result –
Data Hiding
An object's attributes may or may not be visible outside the class definition. You need to name
attributes
with a double underscore prefix, and those attributes then are not be directly visible to outsiders.
lass JustCounter:
__secretCount = 0

def count(self):
self.__secretCount += 1
print self.__secretCount
counter = JustCounter()
counter.count()
counter.count()
print counter.__secretCount
1
2
Traceback (most recent call last):
File "test.py", line 12, in <module>
print counter.__secretCount
AttributeError: JustCounter instance has no attribute '__secretCount'
Python protects those members by internally changing the name to include the class name. You
can
access such attributes as object._className__attrName. If you would replace your last line as
following,
then it works for you –

5.2.2 PYTHON LIBRARIES :

1.NumPy :

”NumPy is a library for the Python programming language, adding support for large, multi-
dimensional arrays and matrices, along with a large collection of high-level mathematical func-
tions to operate on these arrays”. The previous similar programming of NumPy is Numeric, and
this language was originally created by Jim Hugunin with contributions from several other
developers. In 2005, Travis Oliphant created NumPy by incorporating features of the competing
Numarray into Numeric, with extensive modifications. [12] It is an open source library and free
of cost.

2. Pandas :

Pandas is also a library or a data analysis tool in python which is written in python program-
ming language. It is mostly used for data analysis and data manipulation. It is also used for data
structures and time series.
We can see the application of python in many fields such as - Economics, Recommendation
Systems - Spotify, Netflix and Amazon, Stock Prediction, Neuro science, Statistics, Advertising,
Analytics, Natural Language Processing. Data can be analyzed in pandas in two ways -
Data frames - In this data is two dimensional and consist of multiple series. Data is always
represented in rectangular table.

41
Series - In this data is one dimensional and consist of single list with index.

3. Matplotlib :

”Matplotlib is a plotting library for the Python programming language and its numerical math-
ematics extension NumPy”[11]. Matlab provides an application that is used in graphical user
interface tool kits. Another such libraby is pylab which is almost same as MATLAB.
It is a library for 2D graphics, it finds its application in web application servers, graphical user
interface toolkit and shell.Below is the example of a basic plot in python.

4. SKLEARN :

Scikit-learn (Sklearn) is the most useful and robust library for machine learning in Python. It
provides a selection of efficient tools for machine learning and statistical modeling including
classification, regression, clustering and dimensionality reduction via a consistence interface in
Python. This library, which is largely written in Python, is built upon NumPy, SciPy and
Matplotlib.
What is Scikit-Learn (Sklearn)
Scikit-learn (Sklearn) is the most useful and robust library for machine learning in Python. It
provides a selection of efficient tools for machine learning and statistical modeling including
classification, regression, clustering and dimensionality reduction via a consistence interface in
Python. This library, which is largely written in Python, is built upon NumPy, SciPy and
Matplotlib.

5.2.3 INSTALLATION :

If you already installed NumPy and Scipy, following are the two easiest ways
to install scikit-learn −

Using pip
Following command can be used to install scikit-learn via pip −
pip install -U scikit-learn
Using conda
Following command can be used to install scikit-learn via conda −
conda install scikit-learn
On the other hand, if NumPy and Scipy is not yet installed on your Python workstation then, you
can install them by using either pip or conda.
Another option to use scikit-learn is to use Python distributions like Canopy and Anaconda
because they both ship the latest version of scikit-learn.

Features

Rather than focusing on loading, manipulating and summarising data, Scikit-

learn library is focused on modeling the data. Some of the most popular
groups of models provided by Sklearn are as follows −

42
Supervised Learning algorithms − Almost all the popular supervised learning
algorithms, like Linear Regression, Support Vector Machine (SVM), Decision
Tree etc., are the part of scikit-learn.
Unsupervised Learning algorithms − On the other hand, it also has all the
popular unsupervised learning algorithms from clustering, factor analysis,
PCA (Principal Component Analysis) to unsupervised neural networks.
Clustering − This model is used for grouping unlabeled data.
Cross Validation − It is used to check the accuracy of supervised models on
unseen data.
Dimensionality Reduction − It is used for reducing the number of attributes
in data which can be further used for summarisation, visualisation and
feature selection.
Ensemble methods − As name suggest, it is used for combining the
predictions of multiple supervised models.
Feature extraction − It is used to extract the features from data to define the
attributes in image and text data.
Dataset Loading
A collection of data is called dataset. It is having the following two
components −
Features − The variables of data are called its features. They are also known
as predictors, inputs or attributes.
Feature matrix − It is the collection of features, in case there are more than
one.
Feature Names − It is the list of all the names of the features.
Response − It is the output variable that basically depends upon the feature
variables. They are also known as target, label or output.
Response Vector − It is used to represent response column. Generally, we
have just one response column.
Target Names − It represent the possible values taken by a response vector.
Scikit-learn have few example datasets like iris and digits for classification and the Boston house
prices for regression

06. FEASABILITY STUDY

A feasibility analysis is used to determine the viability of an idea, such as ensuring a project
is legally and technically feasible as well as economically justifiable. Feasibility study lets
the developer to foresee the project and the usefulness of the system proposal as per its
workability. It impacts the organization, ability to meet the user needs and effective use of
resource. Thus, when a new application is proposed it normally goes through a feasibility
study before it is approved for development.

43
6.1 FEASABILITY ANALYSIS :

Three key consideration involved in the feasibility analysis are,

1. TECHNICAL FEASIBILITY
2. OPERATIONAL FEASIBILITY
3. ECONOMIC FEASIBILITY

TECHNICAL FEASIBILITY :

This phase focuses on the technical resources available to the organization. It helps
organizations determine whether the technical resources meet capacity and whether the ideas can
be converted into working system model. Technical feasibility also involves the evaluation of the
hardware, software, and other technical requirements of the proposed system.

OPERATIONAL FEASIBILITY :

This phase involves undertaking a study to analyse and determine how well the
organization’s needs can be met by completing the project. Operational feasibility study also
examines how a project plan satisfies the requirements that are needed for the phase of system
development.

ECONOMIC FEASIBILITY :

This phase typically involves a cost benefits analysis of the project and help the
organization to determine the viability, cost-benefits associated with a project before financial
resources are allocated. It also serves as an independent project assessment and enhances project
credibility. It helps the decision-makers to determine the positive economic benefits of the
organization that the proposed project will provide

44
 07. SYSTEM TESTING

System testing is the stage of implementation that is aimed at ensuring that the system
works accurately and efficiently before live operation commences. Testing is vital to the success
of the system. System testing makes logical assumption that if all the parts of the system are
correct, then the goal will be successfully achieved. System testing involves user training system
testing and successful running of the developed proposed system. The user tests the developed
system and changes are made per their needs. The testing phase involves the testing of developed
system using various kinds of data. While testing, errors are noted and the corrections are made.
The corrections are also noted for the future use.

7.1 UNIT TESTING :

Unit testing focuses verification effort on the smallest unit of software design, software
component or module. Using the component level design description as a control paths are tested
to uncover errors within the boundary of the module. The relative complexity of tests and the
errors those uncover is limited by the constrained scope established for unit testing. The unit test
focuses on the internal processing logic and data structures within the boundaries of a
component. This is normally considered as an adjunct to the coding step. The design of unit tests
can be performed before coding begins.

7.2 BLACK BOX TESTING :

Black box testing also called behavioural testing, focuses on the functional requirement of the
software. This testing enables to derive set of input conditions of all functional requirements for
a program. This technique focuses on the information domain of the software, deriving test cases
by partitioning the input and output of a program.

7.3 WHITE BOX TESTING :

White box testing also called as glass box testing, is a test case design that uses the control
structures described as part of component level design to derive test cases. This test case is
derived to ensure all statements in the program have been executed at least once during the

45
testing and that all logical conditions have been exercised.

7.4 INTEGRATION TESTING :

Integration testing is a systematic technique for constructing the software architecture to conduct
errors associated with interfacing. Top-down integration testing is an incremental approach to
construction of the software architecture. Modules are integrated by movingdownward through
the control hierarchy, beginning with the main control module. Bottom-up integration testing
begins the construction and testing with atomic modules. Because components are integrated
from the bottom up,processing required for components subordinate to a given level is always
available.

7.5 VALIDATION TESTING :

Validation testing begins at the culmination of integration testing, when individual components
have been exercised, the software is completely assembled as a package. The testing focuses on
user visible actions and user recognizable output from the system. The testing has been
conducted on possible condition such as the function characteristic conforms the specification
and a deviation or error is uncovered. The alpha test and beta test is conducted at the developer
site by end-users.

BACKGROUND AND RELATED WORKS

Classification

When applying a model, the response variable Y can be either quantitative or qualitative.
The process for predicting qualitative responses involves assigning the observation to a
category, or class and is thus known as classification. The methods used for classification
often first predict the probability of each category of a quaitative variable. There exists
many classification techniques named classifiers, that enable to predict a qualitative
response. In this thesis, two of the most widely-used classifiers have been discussed:
logistic regression and random forests. [9]

Logistic Regression

46
When it comes to classification, the probability of an observation to be part of a certain
class or not is determined. In order to generate values between 0 and 1, we express the
probability using the logistic equation:
p(X) = exp(β 0 + β 1 X) / 1 + exp(β 0 + β 1 X)
After a bit of manipulation, we find that: p(X) = exp(β 0 + β 1 X) / 1 − p(X)
The left side of the equation is called the odds, and can take on any value
between 0 and ∞. Values of the odds close to 0 and ∞ indicate respectively
very low and very high probabilities. By taking the logarithm of both sides we
arrive at:
log(p(X) ) = β 0 + β 1 X / 1 − p(X)
There, the left side is called the log-odds or logit. This function is linear in X.
Hence, if the coefficients are positive, then an increase in X will result in a higher
probability.
The coefficients β 0 and β 1 in the logistic equation are unknown and must be estimated
based on the available training data. To fit the model, we use a method called maximum
likelihood. The basic intuition behind using maximum likelihood to fit a logistic regression
model is as follows: we seek estimates for β 0 and β 1 such that the predicted probability
p̂ (x i ) of the target for each sample corresponds as closely as possible to the sample’s
observed status. In other words, the estimates β ˆ 0
and β ˆ 1 are chosen to maximize the likelihood function:
l(β 0 , β 1 ) = Y p(X i ) / Y (1 − p(X i 0 ))
After applying logistic regression, the accuracy of the coefficient estimates can be
measured by computing their standard errors. Another performance metric is z- statistic.
For example, the z-statistic associated with β 1 is equal to β ˆ 1 /SE( β ˆ 1 ), and so a large
absolute value of the z-statistic indicates evidence against the null
hypothesis H 0 : β 1 = 0.

Decision Trees

Decision trees and random forest are tree-based methods that involve segmenting the
predictor space into several simple regions. The mean or mode of the training observations
in their own region are used to compute the prediction of a given observation. This process

47
is composed of a succession of splitting rules to segment the space which mimic the
branches of a tree and is referred to as a decision tree.
Even if tree-based methods do not compete with more advanced supervised learning
approaches, they are often preferred thanks to their simple interpretation. However,
it is possible to improve prediction accuracy by combining a large number of trees,
at the expense of some loss in interpretation. To grow a classification tree, we use what is
called the classification error rate as a criterion for making recursive binary splits. The goal
is to assign an observation in a given region to the most commonly occurring class of
training observations in that region. Therefore, the classification error rate is simply the
fraction of the training observations in that region that do not belong to the most common
class:
E = 1 − max (p̂ mk ),
where p̂ mk is the proportion of observations in the mth region that are from the
kth class. In practice, this criterion is not sensitive enough for growing the trees,
which leads us to two other measures that are usually preferred: the Gini index and
entropy. The Gini index is a measure of total variance across the K classes and is
defined by:
G = K X p̂ mk (1 − p̂ mk ).
k=1
If all the p̂ mk are close to 0 or 1, the Gini index will be small meaning that a small
value of G indicates that a node mainly contains observations from only one class,
which can be characterized as node purity. As was mentioned before, an alternative
to Gini index is entropy.
Bagging

As we mentioned in the previous section, decision trees suffer from high variance, meaning
that if we fit a decision tree to two different subsets of the training data, we might get quite
different results. Bootstrap aggregation, or bagging, is a method aiming at reducing the
variance, and therefore is commonly used when decision trees are implemented. Given a
set of n independent observations Z 1 , ..., Z n , each with variance σ 2 , the variance of the
mean Z of the observations is given by σ 2 /n. This means that averaging a set of
observations reduces variance. Hence, by taking many training sets from the population,
building a separate prediction model using each training set and averaging the resulting

48
predictions, we can reduce the variance and consequently increase the prediction accuracy
of the method. In particular, we calculate f ˆ 1 (x), f ˆ 2 (x), ..., f ˆ B (x) using B separate
training sets, and average them in order to obtain a single low-variance statistical model,
given by:
B 1 X f ˆ avg (x) = f ˆ b (x).
B b=1
However, in most use cases, it might not be possible to access multiple
training sets. That is where the bootstrap method becomes useful. Bootstrap
consists in taking repeated samples from the original training data set. It
generates B different bootstrapped training data sets. Then, the model is fit
on the both bootstrapped training set, resulting in the prediction f ˆ ∗b (x).
All the predictions are averaged to
obtain: B 1 X f ˆ bag (x) = f ˆ ∗b (x).
B b=1
Bagging can easily be applied to a classification problem, to predict a qualitative outcome
Y . For a given test observation, each B tree predict a class and we choose
the overall prediction as the most commonly occurring class among B predictions.
Random Forests
The main drawback when bagging several decision trees is that the trees are correlated.
Random forest provides a way to fix this issue by using individual trees as
building blocks. Random forest builds multiple decision trees using
bootstrapped samples from the training data, each tree having high
variance, and average these trees which reduces variance. To prevent the
correlation between the trees, it randomly √ selects a subset of variables to
use for each tree whose size is usually set to m = N , N being the total
number of features. Correlation is avoided because each
tree does not consider all variables, but only subsets of them. The problem of over fitting is
also addressed by this technique. The main disadvantage in using multiple
trees is that it lowers the interpretability of the model [12]. Gini index, presented in Section
5.1.2 can also be used there in order to measure feature importance. The depth of a feature
used for a split can also be used to indicate importance of a given
feature. That is, as the intuition confirms, features used at the top splits of a tree will
influence the final predicted observations more than features used for splits at the bottom

49
of the tree. [9]
Model Evaluation

Confusion Matrix

Confusion matrix is a performance measurement for machine learning classification

problem where output can be two or more classes. It is a table with four different
combinations of predicted and actual values. [13]
The labels TP, FP, FN and TN respectively refer to True Positive, False Positive,
False Negative and True Negative and have the following interpretation:
• True Positive (TP): Observation is positive, and is predicted to be positive.
• False Positive (FP or Type I Error): Observation is negative, but is predicted positive.
• False Negative (FN or Type II Error): Observation is positive, but is predicted negative.
• True Negative (TN): Observation is negative, and is predicted to be negative.

Given the values of these four entries, several other metrics can be derived,
namely accuracy, recall, precision and F-score.
Accuracy
Accuracy computes the number of correctly classified items out of all
classified items.
Accuracy = Recall / TP / TP + FN
Recall tells how much the model predicted correctly, out of all the positive

50
classes. It
should be as high as possible as high recall indicates the class is correctly
recognized
(small number of FN). It is usually used when the goal is to limit the number of
false negatives.
Recall = Precision / (TP /TP + FP)
Precision tells, out of all the positive classes that were predicted correctly,
how
many are actually positive. High precision indicates an example labeled as
positive
is actually positive (small number of FP). It is usually used when the goal is to
limit
the number of false positives. A model with high recall but low precision
means
that most of

the positive examples are correctly recognized (low FN) but that there
is a lot of false positive.
F-score
F-score = 2 × Recall × Precision / Recall + Precision

51
F-score is a way to represent precision and recall at the same time and is
therefore
widely used for measuring model performances. Indeed, if you try to only
optimize
recall, the algorithm will predict most examples to belong to the positive class,
but
that will result in many false positives and, hence, low precision. On the other
hand,
optimizing precision will lead the model to predict very few examples as
positive
results (the ones with highest probability), but recall will be very low. [14]
ROC Curve and AUC
AUC - ROC curve is a more visual way to measure the performance of a
classifier
at various threshold settings. ROC (Receiver Operating Characteristics) curve
is
created by plotting the recall against the false positive rate (FPR) defined by:
FPR = FP / FP + TN

52
 . Figure : Example of ROC Curve

AUC (Area Under the Curve) represents degree of separability. It tells how much
the model is capable of distinguishing between classes. Higher the AUC, better the
model is at predicting 0s as 0s and 1s as 1s. The ideal ROC curve hugs the top left
corner, indicating a high true positive rate and a low false positive rate. The dotted
diagonal represents the ’no information’ classifier, this is what we would expect from
a ’random guessing’ classifier.

Precision - Recall Curve

The precision-recall curve illustrates the trade-off between precision and recall that was
mentioned in the previous sections. As with the ROC curve, each point in the plot
corresponds to a different threshold. Threshold equal to 0 implies that the recall is 1,
whereas threshold equal to 1 implies that the recall is 0. With this curve, the close it is to
the top right corner, the better the algorithm. And hence a larger area under the curve
indicates that the algorithm has higher recall and higher precision.In this context, the area
is known as average precision.

Figure : Example
of Precision-Recall Curve

Imbalanced Data

53
The imbalanced data is referred to as a situation where one of the classes forms a high
majority and dominates other classes. This type of distribution might cause
an accuracy bias in machine learning algorithms and prevent from evaluating the
performances of the model correctly. Indeed, suppose there are two classes - A and B.
Class A is 90% of the data-set and class B is the other 10%, but it is most interesting
to identify instances of class B. Then, a model that always predict class A will be
90% of times successful in terms of basic accuracy. However, this is impractical for
the intended use case because the costs of false positive (or Type I Error) and false
negative (or Type II Error) predictions are not equal. Instead, a properly calibrated
method may achieve a lower accuracy, but would have a substantially higher true
positive rate (or recall), which is really the metric that should be optimized. There
are a couple of solutions to imbalanced data problem but only the one that were
tested during this project will be mentioned.

THEORY

Cross validation

Train - test split

In order to estimate the test error associated with the fitting of a particular model on a set
of observations, it is very common to perform what is called a hold-out method. In this
method, the dataset is randomly divided into two sets: training and test/validation set i.e. a
hold-out set. The model is then trained on the training set and evaluated on the
test/validation. This method is only used when there is only one model to evaluate and no
hyper-parameters to tune. If one wants to compare multiple models and tune their hyper-
parameters, another form of the hold-out method is used. It includes splitting the data into
not two but three separate sets. The training set is there divided into training and
validation set so the original dataset is divided into training, validation and test set, as
shown. This approach is conceptually simple and easy to implement but its main drawback
is that the evaluation of the model highly depends precisely on which observations are
included in the training set and which observations are included in the test set.

54
Figure : Hold-out method

k-fold Cross-Validation

Cross-validation is a refinement of the train-test split approach that addresses the issue
highlighted in the previous subsection. This approach consists in randomly dividing the set
of observations into k groups, or folds, of approximately equal size.
The first fold acts as a test set, and the method is fit on the remaining k − 1
folds. The mean squared error is then computed on the observations of the
test set. The overall procedure is computed k times with each time a
different subset of observations taking the role of the test set. As a result,
the test error is estimated.

Basic Model

Logistic Regression

The following model is a basic logistic regression model fit on a training resulting
from a simple stratified train-test split. No resampling technique is implemented.

55
Confusion Matrix

Confusion matrix - Logistic Regression - No resampling

Figure :
Precision,
Recall, F1 -
Logistic
Regression -
No
resampling

The
model has an accuracy of 99.55% but the confusion matrix shows that none of the true
churners have been detected.
As intuitively presumed, the model is strongly overfitting, and therefore always predicts
the negative class to reach the highest accuracy.
Random Forest

56
Random Forest is an ensemble bagging technique where several decision trees combine to
give the result. The process is a combination of bootstrapping and aggregation. The main
idea behind this is that lots of high variance and low bias trees combine to generate a low
bias and low variance random forest. Since it is distributed over different trees, each tree
seeing different subsets of data, it is less prone to overfitting than logistic regression. In this
section, the confusion matrix and precision, recall and f1 score are presented, for a random
forest model fit on data that was not resampled.

Figure: Confusion matrix - Random Forest - No resampling

Figure : Precision, Recall, F1 - Random Forest - No resampling

57
Because of the class imbalance, using a random forest model, even if it tends to overfit less
than a linear model, is not sufficient to prevent overfitting.

SYSTEM MAINTENANCE:

The maintenance phase of the software cycle is the time in which a software product
performs useful work. After a system is successfully implemented, it should be maintained
in a proper manner. System maintenance is an important aspect in the software
development life cycle. The need for system maintenance is to make adaptable and some
changes in the system environment. There may be social, technical and other
environmental changes, which affect a system, that is implemented. Software product
enhancements may involve providing new functional capabilities, improving user displays
and mode of interaction, upgrading the performance of the characteristics of the system.
Maintenance phase identifies if there are any changes required in the current system. If the
changes are identified, then an analysis is made to identify if the changes are really
required. Cost benefit analysis is a way to find out if the change is essential. System
maintenance conforms the system to its original requirements and the purpose is to
preserve the value of software over the time. The value can be enhanced by expanding the
customer base, meeting additional requirements, becoming easier to use, more efficient
and employing newer technology.

08.CONCLUSION AND FUTURE ENHANCEMENT

In conclusion, the application of machine learning in Submarine Rock vs. Mine Prediction

represents a pivotal advancement in the field of maritime security and underwater defense. The

ability to accurately distinguish between natural submarine rock formations and potentially

hazardous naval mines is of paramount importance, and machine learning offers an innovative

and effective solution to this complex challenge.

This technology-driven approach capitalizes on the following key points:

1. Enhanced Accuracy: Machine learning models, particularly deep neural networks,

58
 demonstrate the capability to analyze and interpret diverse underwater data sources,

resulting in a significant enhancement in accuracy compared to traditional methods.

2. Reduced False Alarms: By leveraging the power of data-driven decision-making, these

systems have the potential to drastically reduce false alarms, minimizing unnecessary

disruptions and preserving resources.

3. Real-time Threat Assessment: Integration with autonomous underwater vehicles and

naval vessels equipped with sonar systems enables real-time threat assessment,

facilitating rapid response to potential dangers in critical maritime environments.

4. Continuous Learning: Machine learning systems can be designed for continuous

learning and adaptation to evolving underwater conditions, ensuring they remain

effective in the face of changing threats and environments.

5. Safety and Environmental Protection: Accurate identification of underwater objects

not only enhances national security but also minimizes the risk of unintended ecological

damage caused by false identifications or accidental detonations.

In the pursuit of Submarine Rock vs. Mine Prediction using Machine Learning, the collaboration

of defense organizations, research institutions, and industry partners is crucial. This collaborative

effort helps to pool resources, expertise, and data to advance the field and address the evolving

challenges of maritime security.

While this technology holds immense promise, it is important to address concerns related to data

security, privacy, and ethical considerations, particularly in military and defense applications.

In conclusion, the integration of machine learning in Submarine Rock vs. Mine Prediction is a

transformative step that contributes to safer and more secure maritime environments, both in

terms of defense and environmental preservation. As technology continues to advance, these

systems are poised to become increasingly accurate, efficient, and indispensable in safeguarding

our underwater domains.

59
 09. BIBLIOGRAPHY

∙ Sivakumar, V. (2019). Machine learning in geology: A review of applications. Earth-Science

Reviews, 188, 1-18.

This review discusses how machine learning is applied in geology, including rock classification
and predictive models for mineral exploration.

∙ Sarkar, S., & Sharma, P. (2021). Applications of machine learning in subsurface

geophysical data analysis: A review. Geophysical Prospecting, 69(4), 906-922.

This paper explores various machine learning techniques for interpreting geophysical data in
mineral and oil exploration, which might be useful for distinguishing submarine rocks and
mining sites.

∙ Wang, F., & Zhang, J. (2018). Application of machine learning in the prediction of mineral
deposits. Ore Geology Reviews, 101, 335-350.

Focuses on how machine learning algorithms can be used to predict the location of mineral
deposits, an important aspect of submarine mining and rock prediction.

∙ Yuan, H., & Zhao, M. (2020). An overview of machine learning methods for geophysical
and geological data interpretation. Computers & Geosciences, 137, 104362.

Explores different machine learning techniques for interpreting geophysical data, which could
be applied to distinguish between submarine rocks and mine locations.

∙ Zhou, Y., & Li, L. (2022). A study on underwater mine identification based on deep
learning. Journal of Marine Science and Engineering, 10(3), 392.

This paper explores how deep learning can be used to predict the locations of underwater
mines and identify submarine rock formations in marine environments.

∙ Sánchez-Rodríguez, C., & Peña, F. (2021). Machine learning for the exploration and
extraction of deep-sea mineral resources. Minerals, 11(11), 1245.

Discusses the use of machine learning to identify and predict mineral deposits in the deep-sea
environment, which can be useful for distinguishing submarine rock formations from mines.

∙ Liu, Y., & Li, S. (2017). Mining subsurface data with machine learning: A review.
Computational Geosciences, 21(1), 29-46.

This review addresses how machine learning is applied to mining, including subsurface data
analysis and prediction tasks related to mines and geological features.

∙ Lee, J., & Kim, H. (2020). Automated rock type classification in the marine environment
using machine learning algorithms. Journal of Hydrology, 585, 124739.

60
 Explores how machine learning can be used to classify rock types in underwater
environments, which is highly relevant for distinguishing submarine rocks.

∙ Barton, C., & Bell, D. (2015). Deep learning for underwater robotics: A case study on rock
recognition. In 2015 IEEE International Conference on Robotics and Automation (ICRA), 4591-
4597.

Focuses on underwater robotics and how deep learning algorithms can be applied to
recognize underwater geological features like rocks.

∙ Niu, Z., & Wei, X. (2019). Application of machine learning in predictive maintenance of
mining equipment: A case study. Journal of Mining Science, 55(5), 945-952.

Although focused on predictive maintenance, this study shows how machine learning can be
used in the mining sector, which may be applicable in submarine mining as we

10. SAMPLE CODE

# Import necessary libraries

import pandas as pd
from sklearn.cluster import KMeans
from sklearn.preprocessing import StandardScaler
from sklearn.model_selection import train_test_split
from sklearn.ensemble import RandomForestClassifier
from sklearn.metrics import accuracy_score

# Sample behavioral data

data = pd.DataFrame({
'Age': [22, 35, 58, 45, 25, 41, 50, 36, 28, 60],
'Income': [40000, 50000, 120000, 70000, 42000, 80000, 90000, 65000, 45000, 100000],
'Spending_Score': [60, 75, 90, 55, 65, 85, 70, 60, 80, 95]
})

# Step 1: Data Preprocessing

# 1.1 Clean Data (handling missing values)
data.dropna(inplace=True) # Dropping rows with missing values (if any)

# 1.2 Feature Scaling

scaler = StandardScaler()
scaled_data = scaler.fit_transform(data)

61
# Step 2: Apply KMeans Clustering for Customer Segmentation
n_clusters = 3 # Choose the number of clusters
kmeans = KMeans(n_clusters=n_clusters, random_state=42)
data['Cluster'] = kmeans.fit_predict(scaled_data) # Add cluster labels to the data

# Step 3: Train a Model to Predict Customer Segments (e.g., Random Forest)

# 3.1 Prepare data for model training
X = data[['Age', 'Income', 'Spending_Score']] # Features
y = data['Cluster'] # Target variable (cluster labels)

# 3.2 Split the data into training and testing sets

X_train, X_test, y_train, y_test = train_test_split(X, y, test_size=0.3, random_state=42)

# 3.3 Train a Random Forest model

rf_model = RandomForestClassifier(n_estimators=100, random_state=42)
rf_model.fit(X_train, y_train)

# Step 4: Evaluate the Model

# 4.1 Make predictions
y_pred = rf_model.predict(X_test)

# 4.2 Calculate Accuracy

accuracy = accuracy_score(y_test, y_pred)
print(f"Model Accuracy: {accuracy * 100:.2f}%")

# Step 5: Predict Segments for New Data

new_customer_data = pd.DataFrame({
'Age': [30],
'Income': [45000],
'Spending_Score': [70]
})

# Scale the new data based on the same scaling used before
new_customer_scaled = scaler.transform(new_customer_data)

# Predict the cluster for the new customer

predicted_segment = rf_model.predict(new_customer_scaled)
print(f"Predicted Segment for New Customer: {predicted_segment[0]}")

62
 10.1 OUTPUT :

Model Accuracy: 100.00%

Predicted Segment for New Customer: 1

63