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Today, increased competition between organizations has led them to seek a better understanding of customer behavior through identifying valuable customers. Customers’ expectations about the price and quality of products and services play an important role in their selection process. In online businesses, competition and price differences between suppliers is high, so discounts will attract different customers. As a result, discounts and the frequency and amount of purchases can lead to better understanding of customer behavior. Customer segmentation and analysis is essential for identifying groups of customers. Hence, this study uses a model based on RFM called RdFdMd, in which d is the level of discount used to analyze customer purchase behavior and the importance of discounts on customers’ purchasing behavior and organizational profitability. The CRISP-DM and k-mean algorithm were used for clustering. The results indicate that using the RdFdMd model achieves better customer clustering and valuation, and discounts were identified as an important criterion for customer purchases.
Discussion and conclusion
During the past few years, the organizations’ interaction with their customers has changed significantly, so that there is no guarantee of a long-term relationship between business and customers. To survive, organizations need to truly understand customers’ needs. Organizations can identify the valuable customers, and predict their future behavior through data mining and extraction of hidden information from large databases (Farooqi and Raza 2012; Yadav, Desai, and Yadev 2013). Therefore, understanding customers’ behavioral variables and categorizing customers based on these characteristics could provide better insight that will help business owners and industries to adopt appropriate marketing strategies. Marketing managers can also make long-term relationships by identifying and predicting the changes in customer behavior (Chen, Chiu, and Chang 2005). Customer segmentation would target each customer segment with distinct products and marketing services, and would help them to meet the requirements of each section. Therefore, customer segmentation and analysis of different groups of customers are needed for identifying the groups of customers. Since discount is another aspect of consumer behavior, this study used a two-dimensional approach to analyze customers’ behavior (Rygielski, Wang, and Yen 2002).