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Tuning the Multivariate Poisson Mixture Model for Clustering Supermarket Shoppers (2002)
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BibTeX
@MISC{Brijs02tuningthe,
author = {Tom Brijs and Dimitris Karlis and Gilbert Swinnen and Koen Vanhoof and Geert Wets},
title = {Tuning the Multivariate Poisson Mixture Model for Clustering Supermarket Shoppers},
year = {2002}
}
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Abstract
This paper describes a multivariate Poisson mixture model for clustering supermarket shoppers based on their purchase frequency in a set of product categories. The multivariate nature of the model accounts for cross-selling effects that may exist between the purchases made in different product categories. However, because of computational difficulties, most multivariate approaches limit the covariance structure of the model by including just one common interaction term Although this reduces the number of parameters significantly, it is often too simplistic in practice since typically multiple interactions exist on different levels. This paper proposes a theoretically correct variance/covariance structure of the multivariate Poisson model, based on domain knowledge or preliminary statistical analysis of significant purchase interaction effects in the data in order to produce the most parsimonious clustering model. As a result, the model does not contain more parameters than necessary whilst still accounting for the existing covariance in the data. From a practical point of view, the model can be used by retail category managers to devise customized merchandising strategies as illustrated in the text.
Keyphrases
multivariate poisson mixture model supermarket shopper multiple interaction correct variance covariance structure model account common interaction term significant purchase interaction effect product category multivariate approach different product category cross-selling effect different level computational difficulty preliminary statistical analysis necessary whilst multivariate poisson model covariance structure customized merchandising strategy domain knowledge purchase frequency practical point retail category manager multivariate nature
