A nominal variable is one that identifies a class membership, as opposed to having a numerical meaning. Nominal variables can have numeric values yet have no numeric meaning, no sense of quantity or order. The classic example is the month of the year. We may say that June has the value 6 and November has the value 11. Certainly 11 is greater than 6, but this does not mean that November is greater than June.
Very few prediction or classification models can directly accept a nominal value as an input, which presents a problem if one or more variables in our application ...