1. . MARKET BASKET ANALYSIS
IMPROVETHE CUSTOMER EXPERIENCEAND PROFITS!
QUESTIONS: These are but a sample of the overall questions that apply to each of the
separate analysis
 Which Products or Categories show up the most times in Market Basket?
 Which Products or Categories create the most frequency of visits?
 Which Products or Categories create the most sales by different time periods?
 Which Products or Categories deliver the most GM$
 Which Products or Categories build the strongest Loyalty?
 Are there multiple types of Loyalty happening within different products?
 Identity of the Customers for these Categories, frequency, sales, profit?
 Which Categories are bought by your best and most profitable Customers?
 Pricing on categories that generate the highest market basket?
 Changes by Category and related items when sales are in place?
 Marketing effects when a category is promoted?
ELEMENTS TO BE CROSS ANALYZED: Category, Class, Sub-Class with the other Products in the
Basket
 Number of Transactions
 Avg. Sales per Transaction
 Avg. GM$ per Transaction
 Avg. Marketing $ spent on Cat.
 Categories in largest Basket vs. smaller Basket – units and sales
 Frequency of those Categories
 Units per transaction
 Differencesin Basket when key product is marketed or promoted vs. not.
BRAND/VENDOR ANALYSIS: Is one brand leading the charge in a specific category?Brands
not adding anything but a few sales? What relationships do you need to address with your
vendorsto improve overall performance?
 Once specific product types are identified, which brands are most likely to be in the
basket?
 What are the brands that are 2nd, 3rd, & 4th in that transaction?
 Time Analysis on Vendors – is there specific times that these brands performbest due to
such elements as Holidays, Weekends, Quarters, etc.
TIME PERIOD: Product Categories, Class, Sub-Class – these answers may change by time
periods. The answers to these questions concerning time can dramatically influence product
selection, inventory levels, marketing, pricing, labor and overall profit.
 Year
 Quarter
 Month
 Week
 Day
 Hour

2. PRICING ANALYSIS
 What is the average priceof a category, class or sub-class going out the door?
 Can changes in pricing lead to frequency, more sales, higher GM$?
MARKETING: Which channels of marketing affect specific products and increaseoverall
performance of specific Products.
 Analysis of categories when specific marketing channelsare used. Radio, Billboards, E-
mail as examples.
CUSTOMER DEMOGRAPHICS IN THE DIFFERENTMARKETBASKET ANALYSIS
 Location in USA
 Location in State
 Location in City
 Age
 Gender
 Financial
 Race
 Housing- Own vs. Rent
CHANNEL DIFFERENCES AND COMBINATIONS
 How do Product associations by baskets differ by Channel?
 Time of shopping
 Similar products in basket
 Pricing differences
 Can we learn what level of involvement came fromthe web to shop the store?
ADDITIONAL QUESTIONS ONCE ANALYSIS IS COMPLETED
 What are the value propositions of the top products?
o How can the answers be used for additional products
 Who are the competitors for those products?
o What is the opportunity or risk?
 What Marketing elements to change, add, or reduce by products and time.
 Inventory adjustments by location, time
 Location in store and online for products
 Allocation of space in store and E-Commerce for Products and Categories
SUGGESTED TESTS
 In a Brick-N-Mortar situation, take the top 50 doors and do a complete, full scale
analysis on a product category. Understand the elements that drivethe highest volume
doors.
 Test the Top 50 Learning on at set of Middle 50 doors. See if those learnings can be
applied to be useful in another scenario.
 Use different types of marketing in similar locations to see how the Market Basket is
affected.
 Test new and old marketing channels using specific products that may lead to better
performance.