Data Analysis Using SQL and Excel, 2nd Edition

CHAPTER 9 What’s in a Shopping Cart? Market Basket Analysis

 

The previous chapter discussed everything about customer behavior—when, where, how—with one notable exception: the products actually being purchased. This chapter and the next dive into the detail, focusing on the specific products, to learn both about customers and the products they buy. Market basket analysis is the general name for understanding product purchase patterns at the customer level. Association rules, covered in the next chapter, are specifically about discovering which products are purchased together.

This chapter starts by exploring the individual products purchased in an order. Visualizing the products tells us about both products and customers. And brings up unusual questions, such as “Why do customers purchase the same product multiple times in an order?”

These types of questions naturally lead to investigating the relationship between products and customer behavior. Is purchasing some particular product or products an indicator that the purchaser will return? Conversely, do some products indicate that the customer will make no more purchases? Can we measure the contribution of a product to overall customer value? Answering this question leads to residual value, the value of everything else in orders containing a particular product. Residual value is a useful measure of how good products are for driving increased sales.

Products are related to other customer attributes as well. Some products have ...