Market Basket Analysis (MBA) is an analysis to understand products bought together by the retail customers. Market Basket Analysis is also known as association rule or affinity analysis. The concept of MBA is used now across problem statements and industries. For example: Understanding sequence of calls leading to product closure or customer attrition.
Summary: Organic grocery store source products locally and sell to its customers. As a typically Market basket analysis, the objective was to understand the products bought together, so that appropriate promotion activities can be targeted.
- Frequency of individual products : select frequent products and calculate “support”
- Association Rules: Product Association and plotting bubble chart. Also checked support and lift for the product combinations
- Selected top 5 associations
Summary Insights and Recommendations
- For placing products together to increase cross sell – e.g. Dairy Products along with Bread and Baked products
- Product Bundling – – Cheese and Sausage: “Party platter”
Market Basket Analytics (MBA) is used for store level product affinities, and also helps NEXCOM in determining the success of each store promotion. MBA is attributed with 18% Sales increase for Intimate Apparel, 25% for Men’s Apparel and 24% Ladies’ Shoes
A leading US Quick service restaurant chain leveraged Market Basket Analysis (MBA) for finding product affinities among its core products for increasing marketing effectiveness.