A Markov network approach for reproducing purchase behaviours observed in convenience stores

Abstract

AbstractThe convenience store industry in Japan holds immense significance, making a thorough comprehension of customer purchase behaviour invaluable for companies aiming to gain insights into their customer base. In this paper, we propose a novel application of a Markov network model to simulate purchases guided by stopping probabilities calculated from real data. Each node in the Markov network represents different product categories available for purchase. Additionally, we introduce the concept of a “driving force,” quantifying the influence of purchasing product A on the likelihood of purchasing product B, compared to random purchasing. For instance, our analysis reveals that the inclusion of nutrient bars in a purchase set leads to, on average, a 13% reduction in tobacco purchases compared to random patterns. To validate our approach, we compare the simulated macro-level purchase behaviours with real point of Sale (POS) data obtained from a prominent convenience store giant, 7-Eleven. The dataset is comprised of roughly 54 million receipts, in which we focus on the product categories existing in this dataset rather than individual products. Our model successfully replicates the purchase size distribution for 99.9% of all purchases and the purchase counts across various product categories, demonstrating its efficacy in capturing broad purchase patterns.