ITC516 Data Mining for Business Intelligence-East West Airlines Functi
The dataset EastWestAirlinesCluster.xls contains information on 3999 passengers who belong to an airline’s frequent flier program. For each passenger the data include information on their mileage history and on different ways they accrued or spent miles in the last year. The goal is to try to identify clusters of passengers that have similar characteristics for the purpose of targeting different segments for different types of mileage offers.
a) Apply hierarchical clustering with Euclidean distance and Ward's method. Make sure to normalize the data first. How many clusters appear
b) What would happen if the data were not normalized
c) Compare the cluster centroid to characterize the different clusters, and try to give each cluster a label.
d) Use K-means clustering with the number of clusters that you found above. Does the same picture emerge
e) Which clusters would you target for offers, and what types of offers would you target to customers in that cluster.
Answer:
| Record ID | Cluster ID | Dist. Clust-1 | Dist. Clust-2 | Dist. Clust-3 | Balance | 47.25pt;" width="63">Qual_miles | cc1_miles | cc2_miles | cc3_miles | Bonus_miles | Bonus_trans | Flight_miles_12mo | Flight_trans_12 |
| 1 | 2 | 6.641091178 | 0.693771656 | 3.210742562 | 28143 | 0 | 1 | 1 | 1 | 174 | 1 | 0 | 0 |
| 2 | 2 | 6.621552061 | 0.637048677 | 3.176160506 | 19244 | 0 | 1 | 1 | 1 | 215 | 2 | 0 | 0 |
| 3 | 2 | 6.448456596 | 0.414484195 | 2.930739836 | 41354 | 0 | 1 | 1 | 1 | 4123 | 4 | 0 | 0 |
| 4 | 2 | 6.673519226 | 0.730931609 | 3.240680807 | 14776 | 0 | 1 | 1 | 1 | 500 | 1 | 0 | 0 |
| 5 | 3 | 4.140563714 | 3.738240685 | 1.770265644 | 97752 | 0 | 4 | 1 | 1 | 43300 | 26 | 2077 | 4 |
| 6 | 2 | 6.717414006 | 0.813978698 | 3.305356685 | 16420 | 0 | 1 | 1 | 1 | 0 | 0 | 0 | 0 |
| 7 | 3 | 5.668697366 | 2.599740077 | 1.039396898 | 84914 | 0 | 3 | 1 | 1 | 27482 | 25 | 0 | 0 |
| 8 | 2 | 6.23323506 | 0.419242432 | 2.949288966 | 20856 | 0 | 1 | 1 | 1 | 5250 | 4 | 250 | 1 |
| 9 | 1 | 7.502626115 | 9.578270793 | 8.986436205 | 443003 | 0 | 3 | 2 | 1 | 1753 | 43 | 3850 | 12 |
| 10 | 3 | 4.546076956 | 3.01726127 | 1.461784365 | 104860 | 0 | 3 | 1 | 1 | 28426 | 28 | 1150 | 3 |
| 11 | 2 | 6.143645783 | 0.803681516 | 2.11531854 | 40091 | 0 | 2 | 1 | 1 | 7278 | 10 | 0 | 0 |
| 12 | 3 | 6.086809303 | 3.944375492 | 1.420260353 | 96522 | 0 | 5 | 1 | 1 | 61105 | 19 | 0 | 0 |
| 13 | 2 | 5.879327947 | 1.597087567 | 1.815639673 | 43382 | 0 | 2 | 1 | 1 | 11150 | 20 | 0 | 0 |
| 14 | 2 | 6.375569534 | 0.32594779 | 2.842954562 | 43097 | 0 | 1 | 1 | 1 | 3258 | 6 | 0 | 0 |
| 15 | 2 | 6.714106589 | 0.810090751 | 3.30192712 | 17648 | 0 | 1 | 1 | 1 | 0 | 0 | 0 | 0 |
| 16 | 3 | 6.063449542 | 2.963549627 | 1.104133816 | 28495 | 0 | 4 | 1 | 1 | 49442 | 15 | 0 | 0 |
| 17 | 3 | 5.978608762 | 2.981508956 | 0.900448795 | 51890 | 0 | 4 | 1 | 1 | 48963 | 16 | 0 | 0 |
| 18 | 2 | 6.480634156 | 0.459860315 | 2.952124986 | 13958 | 0 | 1 | 1 | 1 | 4291 | 5 | 0 | 0 |
| 19 | 3 | 5.755249183 | 2.073751483 | 0.784950902 | 91473 | 0 | 3 | 1 | 1 | 27408 | 17 | 0 | 0 |
| 20 | 2 | 6.352379967 | 1.442107936 | 2.091400411 | 23354 | 0 | 3 | 1 | 1 | 10447 | 5 | 0 | 0 |
| 21 | 3 | 5.539226553 | 4.09337028 | 1.436009084 | 120576 | 0 | 5 | 1 | 1 | 58831 | 23 | 250 | 2 |
| 22 | 1 | 3.693648589 | 3.921028711 | 4.170146736 | 185681 | 2024 | 1 | 1 | 1 | 13300 | 16 | 1800 | 9 |
| 23 | 1 | 3.581692642 | 3.613949238 | 4.423216655 | 20584 | 0 | 1 | 1 | 1 | 3450 | 11 | 3450 | 11 |
| 24 | 2 | 5.933662611 | 0.574730981 | 2.599082656 | 66275 | 0 | 1 | 1 | 1 | 2533 | 11 | 150 | 1 |
| 25 | 2 | 4.674234264 | 2.458325995 | 2.783791782 | 205651 | 500 | 1 | 1 | 1 | 4025 | 21 | 700 | 4 |
| 26 | 2 | 6.525916044 | 0.482849362 | 3.040256385 | 20726 | 0 | 1 | 1 | 1 | 1375 | 4 | 0 | 0 |
| 27 | 2 | 5.850680325 | 0.99225098 | 3.231038914 | 18521 | 0 | 1 | 1 | 1 | 1227 | 2 | 1227 | 2 |
| 28 | 2 | 6.738315043 | 0.841541653 | 3.327472072 | 8828 | 0 | 1 | 1 | 1 | 0 | 0 | 0 | 0 |
| 29 | 3 | 5.53658703 | 2.327085932 | 0.781887719 | 59763 | 0 | 3 | 1 | 1 | 33772 | 20 | 100 | 1 |
| 30 | 2 | 5.992112187 | 0.418825379 | 2.781498431 | 19221 | 0 | 1 | 1 | 1 | 4655 | 8 | 500 | 1 |
| 31 | 3 | 5.775846649 | 2.160936097 | 1.27905345 | 177926 | 0 | 3 | 1 | 1 | 20797 | 13 | 0 | 0 |
| 32 | 2 | 6.734979164 | 0.83682151 | 3.323893552 | 10021 | 0 | 1 | 1 | 1 | 0 | 0 | 0 | 0 |
| 33 | 3 | 5.717616877 | 3.902870166 | 1.774854473 | 276571 | 0 | 4 | 1 | 1 | 42044 | 23 | 0 | 0 |
| 34 | 2 | 6.668315621 | 0.722614721 | 3.239239279 | 18047 | 0 | 1 | 1 | 1 | 100 | 1 | 0 | 0 |
| 35 | 2 | 6.648509612 | 0.769600887 | 3.238862137 | 43832 | 0 | 1 | 1 | 1 | 0 | 0 | 0 | 0 |
| 36 | 3 | 3.803641129 | 3.955647797 | 2.085210602 | 123759 | 0 | 4 | 1 | 1 | 50572 | 23 | 2500 | 5 |
| 37 | 2 | 5.850331324 | 0.78055309 | 3.093658697 | 23193 | 0 | 1 | 1 | 1 | 650 | 4 | 550 | 3 |
| 38 | 2 | 6.052685453 | 0.699218141 | 3.071191607 | 68666 | 0 | 1 | 1 | 1 | 350 | 2 | 350 | 2 |
| 39 | 3 | 5.820997736 | 2.03382363 | 0.903781323 | 59990 | 0 | 3 | 1 | 1 | 27878 | 17 | 0 | 0 |
| 40 | 2 | 6.757265474 | 0.870346719 | 3.348122716 | 2176 | 0 | 1 | 1 | 1 | 0 | 0 | 0 | 0 |
| 41 | 2 | 6.129813943 | 0.424734383 | 2.984851324 | 34616 | 0 | 1 | 1 | 1 | 1750 | 4 | 500 | 1 |
| 42 | 3 | 5.953198605 | 3.263953216 | 1.339017409 | 10470 | 0 | 4 | 1 | 1 | 38094 | 26 | 0 | 0 |
| 43 | 1 | 3.121102498 | 3.709494595 | 3.891974583 | 60313 | 0 | 1 | 1 | 1 | 10000 | 26 | 3250 | 9 |
| 44 | 3 | 7.115365479 | 5.954325066 | 5.19180082 | 619393 | 0 | 3 | 1 | 1 | 15008 | 14 | 0 | 0 |
| 45 | 3 | 5.723502039 | 2.08114914 | 1.011406393 | 121260 | 0 | 3 | 1 | 1 | 18493 | 18 | 0 | 0 |
| 46 | 2 | 4.175549727 | 3.294466874 | 3.304492118 | 288865 | 967 | 1 | 1 | 1 | 23600 | 14 | 2000 | 4 |
| 47 | 2 | 6.139175562 | 0.908766353 | 2.130726515 | 92336 | 0 | 2 | 1 | 1 | 11214 | 6 | 0 | 0 |
| 48 | 2 | 5.927228556 | 0.431761131 | 2.806549007 | 36924 | 0 | 1 | 1 | 1 | 5900 | 6 | 300 | 2 |
| 49 | 3 | 5.285002813 | 2.632445909 | 0.905214567 | 70312 | 0 | 3 | 1 | 1 | 34678 | 24 | 500 | 1 |
| 50 | 2 | 5.493597013 | 1.188253007 | 3.215326174 | 17051 | 0 | 1 | 1 | 1 | 1150 | 4 | 1150 | 4 |
| 51 | 1 | 4.249537225 | 4.592374097 | 5.253215026 | 108137 | 0 | 1 | 1 | 1 | 6368 | 5 | 6368 | 5 |
| 52 | 2 | 6.712912913 | 0.793117543 | 3.284997435 | 1300 | 0 | 1 | 1 | 1 | 370 | 1 | 0 | 0 |
| 53 | 3 | 5.81541847 | 4.308702027 | 2.099229035 | 118531 | 0 | 4 | 1 | 1 | 44577 | 38 | 0 | 0 |
| 54 | 2 | 5.538011001 | 0.945042555 | 2.650811105 | 121395 | 0 | 1 | 1 | 1 | 4970 | 8 | 650 | 2 |
| 55 | 2 | 6.661462833 | 0.771040774 | 3.2504528 | 38348 | 0 | 1 | 1 | 1 | 0 | 0 | 0 | 0 |
| 56 | 2 | 6.465860624 | 0.443037906 | 2.956813631 | 14448 | 0 | 1 | 1 | 1 | 1625 | 6 | 0 | 0 |
| 57 | 3 | 5.947039227 | 2.595115591 | 0.738900843 | 75971 | 0 | 4 | 1 | 1 | 34339 | 14 | 0 | 0 |
| 58 | 2 | 5.72421974 | 0.72848062 | 2.961757014 | 36298 | 0 | 1 | 1 | 1 | 3100 | 5 | 600 | 3 |
| 59 | 3 | 6.112219004 | 1.874221984 | 1.450999217 | 38077 | 0 | 3 | 1 | 1 | 34024 | 8 | 0 | 0 |
| 60 | 3 | 3.465196062 | 3.242830344 | 2.329758415 | 95118 | 0 | 3 | 1 | 1 | 23188 | 23 | 2200 | 7 |
| 61 | 3 | 5.810339797 | 1.897450071 | 1.220227291 | 134457 | 0 | 3 | 1 | 1 | 15588 | 14 | 0 | 0 |
| 62 | 2 | 6.171534924 | 0.82904814 | 2.452909011 | 19918 | 0 | 1 | 1 | 1 | 17601 | 11 | 0 | 0 |
| 63 | 2 | 6.7347032 | 0.836436145 | 3.323598314 | 10120 | 0 | 1 | 1 | 1 | 0 | 0 | 0 | 0 |
| 64 | 2 | 6.175834023 | 3.34180492 | 3.391149373 | 362642 | 0 | 1 | 1 | 1 | 28079 | 8 | 0 | 0 |
| 65 | 2 | 6.476713245 | 0.690674122 | 3.044414449 | 80250 | 0 | 1 | 1 | 1 | 895 | 2 | 0 | 0 |
| 66 | 1 | 4.542684093 | 9.473804923 | 8.809130547 | 53914 | 0 | 3 | 1 | 1 | 33767 | 45 | 5550 | 29 |
| 67 | 2 | 6.444010397 | 0.475250137 | 2.926823317 | 9375 | 0 | 1 | 1 | 1 | 1750 | 7 | 0 | 0 |
| 68 | 3 | 5.847192692 | 2.776394795 | 0.526235305 | 83237 | 0 | 4 | 1 | 1 | 35287 | 18 | 0 | 0 |
| 69 | 3 | 5.793916086 | 2.533883437 | 1.602258108 | 230715 | 0 | 3 | 1 | 1 | 24047 | 12 | 0 | 0 |
| 70 | 3 | 5.94330641 | 1.745322716 | 1.38491665 | 47457 | 0 | 3 | 1 | 1 | 12621 | 16 | 0 | 0 |
| 71 | 2 | 6.990355987 | 6.593239585 | 6.636923925 | 84409 | 5031 | 2 | 1 | 1 | 15436 | 16 | 1150 | 4 |
| 72 | 3 | 5.866581721 | 3.377173326 | 1.5802066 | 252386 | 0 | 4 | 1 | 1 | 39787 | 13 | 0 | 0 |
| 73 | 3 | 6.604549917 | 5.274661975 | 4.556976046 | 550367 | 0 | 3 | 1 | 1 | 12500 | 13 | 50 | 1 |
| 74 | 2 | 5.712089395 | 1.042284364 | 3.188029579 | 12646 | 0 | 1 | 1 | 1 | 631 | 4 | 631 | 4 |
| 75 | 3 | 5.709679972 | 2.133397807 | 0.823958111 | 123867 | 0 | 3 | 1 | 1 | 25308 | 17 | 0 | 0 |
| 76 | 3 | 5.670661705 | 2.34892702 | 1.171595584 | 129871 | 0 | 3 | 1 | 1 | 15776 | 22 | 0 | 0 |
| 77 | 2 | 5.91497581 | 1.236036323 | 2.35277385 | 109380 | 0 | 1 | 1 | 1 | 7537 | 16 | 0 | 0 |
| 78 | 3 | 5.782952544 | 2.831520848 | 0.483241511 | 111157 | 0 | 4 | 1 | 1 | 32883 | 19 | 0 | 0 |
| 79 | 3 | 5.92402361 | 2.803809399 | 0.751152851 | 49238 | 0 | 4 | 1 | 1 | 38037 | 18 | 0 | 0 |
| 80 | 3 | 6.020095436 | 4.256330797 | 2.05559958 | 38896 | 0 | 5 | 1 | 1 | 76988 | 16 | 556 | 1 |
| 81 | 2 | 6.374349588 | 1.297085018 | 2.651088172 | 4340 | 0 | 1 | 1 | 1 | 32685 | 5 | 0 | 0 |
| 82 | 2 | 5.479303391 | 1.125685299 | 3.084692694 | 88443 | 0 | 1 | 1 | 1 | 1200 | 3 | 1200 | 3 |
| 83 | 2 | 6.392502568 | 0.555355424 | 2.878854894 | 8454 | 0 | 1 | 1 | 1 | 498 | 9 | 0 | 0 |
| 84 | 2 | 6.347112674 | 0.387519318 | 2.839684399 | 61990 | 0 | 1 | 1 | 1 | 1625 | 6 | 0 | 0 |
| 85 | 2 | 6.402497 | 0.386411897 | 2.879902081 | 24093 | 0 | 1 | 1 | 1 | 1750 | 7 | 0 | 0 |
| 86 | 3 | 5.360927358 | 3.885368752 | 1.673668565 | 35418 | 0 | 5 | 1 | 1 | 58557 | 18 | 900 | 3 |
| 87 | 2 | 6.383029389 | 0.389210147 | 2.812106526 | 40284 | 0 | 1 | 1 | 1 | 7719 | 5 | 0 | 0 |
| 88 | 3 | 5.473686568 | 6.388509085 | 5.420491826 | 609477 | 0 | 3 | 1 | 1 | 21422 | 22 | 1200 | 8 |
| 89 | 2 | 5.453760214 | 1.26463676 | 1.861092218 | 62553 | 0 | 2 | 1 | 1 | 7672 | 16 | 700 | 1 |
| 90 | 2 | 6.077800474 | 0.40926104 | 2.917191378 | 48433 | 0 | 1 | 1 | 1 | 3500 | 4 | 500 | 1 |
| 91 | 2 | 4.954408616 | 1.592647251 | 2.812608982 | 20508 | 0 | 1 | 1 | 1 | 22250 | 8 | 1250 | 5 |
| 92 | 2 | 5.253200422 | 1.637237569 | 3.414135863 | 2000 | 0 | 1 | 1 | 1 | 2000 | 4 | 2000 | 4 |
| 93 | 3 | 5.777767614 | 3.17790489 | 0.86846683 | 78629 | 0 | 4 | 1 | 1 | 36679 | 25 | 0 | 0 |
| 94 | 2 | 5.148382888 | 1.510777178 | 2.969914104 | 143566 | 0 | 1 | 1 | 1 | 5000 | 5 | 1500 | 3 |
| 95 | 1 | 4.302995122 | 7.815917303 | 5.90684882 | 185549 | 0 | 5 | 1 | 1 | 110859 | 39 | 2950 | 16 |
| 96 | 2 | 6.163826603 | 1.070294323 | 2.631568855 | 16796 | 0 | 1 | 1 | 1 | 2875 | 16 | 0 | 0 |
| 97 | 2 | 5.930671172 | 1.751462253 | 2.486588729 | 57346 | 0 | 1 | 1 | 1 | 5560 | 23 | 0 | 0 |
| 98 | 3 | 5.86118923 | 2.921536644 | 0.578523039 | 102062 | 0 | 4 | 1 | 1 | 44247 | 16 | 0 | 0 |
| 99 | 2 | 6.52159374 | 0.475752044 | 3.03563577 | 22324 | 0 | 1 | 1 | 1 | 1375 | 4 | 0 | 0 |
| 100 | 3 | 5.929672696 | 1.700761754 | 1.198061814 | 64824 | 0 | 3 | 1 | 1 | 20184 | 13 | 0 | 0 |
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