Jonathan Marek

Family Dollar Tests Basket Analysis

March 11, 2010

FROM RETAILWIRE:
In a project last year, Family Dollar worked with Applied Predictive Technologies to understand what's happening at the basket level. How do you think better access to basket analysis insights can help retailers and vendors?      [more...]

Family Dollar's examples demonstrate how market basket analysis can be taken from interesting to valuable. The specific ideas Brian Strickland discussed about would work well at any major retailer.

As retailers think about better using market basket analysis, here are some additional ways APT has seen clients generate value:
- assessing product loyalty within a category by tying basket and customer data;
- estimating the "hidden cost" of any promotion (BOGO, x% off, $10 off $50, etc.) by analyzing past baskets;
- understanding how store-level and market-level actions such as new displays, media, remodels, or even labor changes impact different types of baskets.

This is a analytical capability every retailer ought to have in house. Our clients are just getting started in finding innovative and valuable uses of this type of analysis.