A retail company wants to segment its customers into groups based solely on their purchasing patterns, and no predefined labels exist for the groups. Which machine learning approach best fits this requirement?
Clustering
Binary classification
Regression
Time-series forecasting
Because there are no predefined categories (labels), the company needs a technique that can discover natural groupings in the data. Clustering is an unsupervised learning method that automatically groups similar data points, making it the suitable choice. Classification, regression, and time-series forecasting are supervised techniques that require labeled training data or historical target values.
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