Market Basket Analysis

A modeling technique based upon the theory that if you buy a certain group of items, you are more (or less) likely to buy another group of items.

What is Market Basket Analysis?

Market Basket Analysis is a data mining technique that examines the relationships between items that are frequently purchased together by customers. The goal is to uncover patterns and associations within transactional data in order to understand customer behavior and preferences. By analyzing these item sets, retailers can gain insights into which products are commonly bought together and use this information to improve various aspects of their business, such as product placement, cross-selling opportunities, and targeted marketing strategies. The results of Market Basket Analysis can help businesses enhance their sales and profitability by influencing purchasing decisions and increasing customer satisfaction. Through this analysis, retailers can optimize their inventory management, pricing strategies, and overall business operations to meet the evolving needs and expectations of their customers. Market Basket Analysis enables businesses to identify hidden patterns in customer behavior, ultimately leading to more effective decision-making and a more personalized shopping experience for consumers.