13 Apr 2018

Basket Analysis for eCommerce and Brick-and-Mortar Retail


Data Mining & Text Mining are gaining a foothold across many verticals, including eCommerce. While many retail merchants are already aware that this Data Science and NLP techniques can benefit them online, they barely have any idea about how much of a boon they could be for their brick-and-mortar business. Nevertheless, making friends with Data & Text Mining can pack a wallop for you, as a retailer, across the board. Moreover, some of the more intricate applications of Data and Text Mining are suitable for both eCommerce and brick-and-mortar stores and you can use them in parallel in order to enhance the effect.

We’ll dwell on just one such application, so that you can decide whether bringing it into play can bring you closer to your business goals.

Basket Analysis: How NLP and Data Science Can Help You Sell More


One of the awesome techniques you can apply both online and offline is Basket Analysis. Even the name of this approach suggests something you deal with day in day out in both your physical stores and on the Web: baskets or carts filled with your products by your customers. Did those items wind up in the same basket by pure chance? How often do they find themselves in the same company? How many baskets like that do you process over a meaningful period of time? Can that be considered a trend?

You will have probably deduced by now it deals with identifying a pattern in accordance with which the products you sell co-occur. Is that possible to do? With Data & Text Mining, it certainly is. You can explore the invisible relationships between the different products and product groups that make up your online and offline inventory and determine which of them “gravitate to one another”.

How can you benefit from this knowledge?


In fact, the ability to identify which of your products sell together opens up an entire host of practicable opportunities.
  1. If you have determined there is an A>B relationship between two products or groups of products, you can offer a complementary product B to those online shoppers who have added to cart Product A. By means of Text Mining that is designed to understand a product’s attributes from text the way a human would do, you can further tailor and enhance this offering. This can be done in several ways:
    1. You can display a complementary product or products based on the description and properties of Product A that has been added to cart.
    2. You can offer a complementary product or products based on your shopper’s previous searches for products of this category. In this case, the complementary products you can offer can feature the properties your shopper was interested in during their previous searches, which will increase the selling odds.
  2. Basket Analysis allows you to optimize the arrangement of your products in your eCommerce store. In addition to placing together products that have proven to be associated, you can also approach the equation from the other end and identify product categories one and the same shopper is unlikely to be interested in. Someone making a search for wholesome herbal teas is not very likely to buy strong liquor during the same visit, don’t you think so? More so, by using your Basket Analysis insights, you can eliminate any undesirable negative associations that may affect your visitor’s buying decision.
  3. Text Mining gives you another great ability that can further enhance the way you present your complementary products on a suitable occasion prompted by Data Mining: the ability to display relevant customer reviews. When a complementary product gets recommended, a Sentiment Analysis-driven capability of your system can identify positive feedback related to this product or products starting with the most recent, and display it to your shopper.
  4. With physical stores, it’s a bit more difficult to juggle things and cough up whatever can be relevant at the right instant in time. However, the insights you’ve gleaned online can be projected on to the brick-and-mortar part of your business just as well. By means of merchandising, you can still position together products that “gravitate” toward one another. You can also try to avoid provoking any negative associations.

It is beyond the scope of this article to describe some of the benefits of Basket Analysis that are not associated with influencing buying intent, but they, nevertheless, are present too. In particular, Basket Analysis can be used for product inventory-related predictions.

Sources used for this article:
https://en.wikipedia.org/wiki/Affinity_analysis

Similar Articles

09 Mar 2017

Your eCommerce and NLP: A Great Marriage

For an ecommerce service provider, time has a different meaning. The inability, or inadequate ability, to reach out to each individual online shopper with the right offer at the right instant results in exorbitant abandonment and conversion rates. Not surprisingly, in 2016 the great majority of ecommerce providers reported a staggering 60-70% abandonment rate. If you engage in ecommerce, we are sure you could improve your conversion rate as well.
Keep reading
22 Apr 2017

Text Mining: The Marketing Game-Changer

Every marketer’s dream is to be an economic seer and prophet. Essentially, they strive to look at people’s and businesses’ wants and needs through the crystal ball of segmentation theory, use a miscellany of sophisticated tools as magic wands and, ultimately, try to outgun one another in this intricate trade. In a nutshell, up until recently, secondary indicators of an audience's interest in whatever these marketers’ companies produce or sell were the main source of Marketing insights.
Keep reading
25 May 2017

Text Mining in Banking: A Winning Approach

While banks have been comparatively conservative business entities, in recent years they have found themselves in a business space that is usually more competitive than other verticals. Mobile and digital technology, the fading of customer loyalty, and the dramatically reduced consumer attention span have all spurred much financial institutions into giving up their traditional business approaches. In corporate banking, decision makers are often occupied or out of reach.
Keep reading
25 Jul 2017

Multilingual Chat Bots in New Markets’ Acquisition

There are several problems that may hamper your sales to overseas markets and can be solved by multilingual chat bots. Chatbots are swiftly gaining ground but are still seldom conceived and developed to sell to foreign-speaking markets. Just how much opportunity can be there, speak more than one language and is it really worth the bother to make your forthcoming chatbot multilingual?
Keep reading
02 Aug 2017

Chat bots: How to Choose One that Suits Your Needs

No longer conjecture, chat bots are here changing things big time. You think you need one? Are you a newbie to this stuff? Then it’s high time you learn something about them before you miss the boat. Still less unique than humans, chat bots vary no less than automobiles. A city sedan, a jeep, a sports car, or, perhaps, a heavy truck? Careful -- they are not completely interchangeable.
Keep reading
06 Sep 2017

5 Things to Ask Your Chat Bot Provider

Artificial Intelligence developing full-bore, chatbots are, currently, a rage. If having one developed for your business has crossed your mind, you should be aware that sole reliance on the provider you choose may not be the best approach. There are several reasons why you'd better have an idea about the do's and don'ts of the business before getting the show on the road. First off, while being sufficiently ripe by now, the technology still falls short in some respects. Secondly, chatbots vary widely. An unsophisticated chatbot, partially assembled from prefab parts, would be a far cry from a multilingual one that is based on a powerful Natural Language Understanding layer and allows your customers to add an order to cart or perform some other action.
Keep reading
10 Oct 2017

How Expensive a Chatbot Is and How You Can Pay Much Less to Get One

Is it not that difficult to size up the amount of time and funds you need to commit when you know exactly what you need. But what if you don’t? Asking how much a chatbot costs is akin to asking how dear a car or a dress can get: it all hinges upon your needs and wants. Let us see if we can define those and try to make some calculations. In making these calculations, we will use the rates, quoted by Eastern-European software providers.
Keep reading
05 Jan 2018

EXTRACT, TRANSFORM, LOAD: How Not To Make It a Bungling Performance

What does it take a Healthcare institution to harness the ETL technology the right way, derive insights from their data, stay fully compliant with the numerous regulations and not botch the whole thing up? What is the best way of approaching the issue? What should Healthcare decision-makers be aware of prior to the kick-off?
Keep reading
16 Mar 2018

NLP: Profitable Clairvoyance in eCommerce

At first blush, text mining may seem like the umpteenth lofty technicality or piece of terminology you as an ecommerce business owner can live without. But is that true? Actually, text mining will satisfy something you, as a merchant, have always craved -- the ability to read your customers’ minds. Is this possible? How to use this gift gainfully in your business is among the topics we’ll explore.
Keep reading

Please feel free to contact us: