🛒 Which item will you pair with this one? Analyze shopping basket behavior with “Market Basket Analysis” to increase sales without lowering prices. 🛍️
In retail or e-commerce, have you ever wondered why certain products are surprisingly often purchased together? This phenomenon isn't a coincidence, but rather a hidden relationship in purchasing behavior evident in tens of thousands, even hundreds of thousands, of receipts
Market Basket Analysis, also known as Association Rule Mining, is the process of analyzing sales transaction data to identify patterns of products that customers frequently purchase together
📊 3 key indicators for deciphering the shopping basket
- Support (Combined Frequency): The proportion of bills containing both product A and product B simultaneously indicates how popular this combination is overall
- Confidence: If a customer picks up product A, what percentage chance is there that they will also pick up product B? This helps measure the strength of the connection
- Lift (Level of Relationship): This number is the most important!
If Lift > 1, it means that purchasing product A significantly stimulates the purchase of product B.
If Lift = 1, it means that the two products were purchased together coincidentally and did not influence each other.
🚀 How to use insights from your shopping cart to boost sales?
- Store Layout Optimization: Place related products close together or along shopping aisles to encourage purchases
- Cross-Merchandising/Bundling: Instead of lowering the price of individual products, package them together as a pair of fast-moving, high-profit items to increase overall margins
- Automated product recommendation system (Recommendation Engine): For online channels, it presents relevant products immediately on the checkout page to increase the average basket size
The daily recorded trading data is a vast treasure trove. By processing it using a retail business data analytics system and R&D BI, you can discover endless new profit opportunities
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