Please use this identifier to cite or link to this item: http://hdl.handle.net/1942/2285
Title: A multivariate Poisson mixture model for marketing applications
Authors: BRIJS, Tom 
KARLIS, Dimitris 
SWINNEN, Gilbert 
VANHOOF, Koen 
WETS, Geert 
Manchanda, P.
Issue Date: 2004
Publisher: BLACKWELL PUBL LTD
Source: STATISTICA NEERLANDICA, 58(3). p. 322-348
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 between the purchases made in different product categories. However, for computational reasons, most multivariate approaches limit the covariance structure by including just one common interaction term, or by not including any covariance at all. Although this reduces the number of parameters significantly, it is often too simplistic as typically multiple interactions exist on different levels. This paper proposes a theoretically more complete variance/covariance structure of the multivariate Poisson model, based on domain knowledge or preliminary statistical analysis of significant purchase interaction effects in the data. Consequently, the model does not contain more parameters than necessary, whilst still accounting for the existing covariance in the data. Practically, retail category managers can use the model to devise customized merchandising strategies.
Notes: Limburgs Univ Ctr, Dept Econ, B-3590 Diepenbeek, Belgium. Athens Univ Econ, Dept Stat, Athens 10434, Greece. Univ Chicago, Grad Sch Business, Chicago, IL 60637 USA.Brijs, T, Limburgs Univ Ctr, Dept Econ, Univ Campus, B-3590 Diepenbeek, Belgium.tom.brijs@luc.ac.be karlis@aueb.gr puneet.manchanda@gsb.uchicago.edu
Keywords: mixture models; clustering; EM algorithm; multivariate Poisson; product purchasing
Document URI: http://hdl.handle.net/1942/2285
ISSN: 0039-0402
e-ISSN: 1467-9574
DOI: 10.1111/j.1467-9574.2004.00125.x
ISI #: 000223056200005
Category: A1
Type: Journal Contribution
Validations: ecoom 2005
Appears in Collections:Research publications

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