Execution of Market Basket Analysis and Recommendation Systems in Physical Retail Stores to Advance Sales Revenues

Abstract

In the early months of 2020, pandemic covid-19 hit many parts of the world. Especially developing countries like India observed a negative growth rate in few quarters of last financial year. Retailing is one of the key sectors that contribute to Indian GDP with a share of nearly 10 percent. Hence there is a need for the retail sector to bounce back which is possible with the efficient use of new digital technologies. Market basket analysis is used here to extract the association rules which can be directly used for formulating discount and combo offers. Along with that, these rules can be used to decide the product positioning in the retail store. Items which are bought together can be placed next to each other to increase sales. Recommendation systems are most commonly used in ecommerce websites like Amazon, Flipkart, etc, and streaming platforms like Netflix to recommend the items that are to be purchased by users. Although recommendation engines are implemented in multiple web and mobile applications, these are not in the implementation stage in offline retail stores due to many implications associated with them like infrastructure, cost, etc. In this project, we have used market basket analysis and recommendation systems to propose a model to implement in retail stores to increase sales revenues and enhance customer experience.