Track: Modeling and Simulation

Abstract

Jamu is a traditional Indonesian medicine that has become part of the culture. The increasing demand for traditional
medicines, especially Jamu in Indonesia due to the COVID-19 pandemic, provides opportunities for the traditional
and herbal medicinal business. The increase in demand leads to the emergence of new traditional and health product
SMEs, at the same time, online purchase transactions have also increased, encouraging SMEs to switch to e-
commerce. This study aims to determine the segmentation and value of each customer segment using CLV and
develop strategies for each customer segmentation in order to increase customer loyalty. The K-Means Clustering
method is used to segment customers into several clusters and the CLV value is used to determine the value of each
customer segment with Recency, Frequency, and Monetary (RFM) variables. Cluster deployment using the Customer
Value Matrix (CVM) was also carried out to ensure cluster characteristics. Secondary data obtained from sales
transactions. Analysis of product sales is carried out using the Association Rule method which produces one of the
strategies in Customer Development. The research resulted in 5 clusters for customers with 13 strategies for the whole cluster. The cross-selling strategy is the recommended strategy.

Keywords
Customer Loyalty, Model RFM, Customer Lifetime Value, Herbal SMEs, Association Rules.