Hybrid Recommendation Algorithm

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Hybrid Recommendation Engines : Factoring in transaction similarity, demographics, market and time conditions of the purchase • Select product category for analysis • Select customer type, conditions, demographics for analysis. Stage 1: Product plane displays associations based on transaction Bundling of products ~ clustering Relative positioning of products ~ neighbours, bridge structures Linkages among products ~ opportunities for cross sell and up sell Isolated products ~ What is the opportunity ? Stage 2 : Customer plane displays clusters based on past transactions, demographics, conditions of purchase Stage 2 : Linking of customers to recommended products ~ combination of information retrieval and collaborative filtering via neural networks. •Separate treatment for low and high degree associations.

Transcript of Hybrid Recommendation Algorithm

Page 1: Hybrid Recommendation Algorithm

Hybrid Recommendation Engines : Factoring in transaction similarity, demographics, market and time conditions of the purchase

• Select product category for analysis

• Select customer type, conditions, demographics for analysis.

• Stage 1: Product plane displays associations based on transaction• Bundling of products ~ clustering• Relative positioning of products ~ neighbours, bridge structures• Linkages among products ~ opportunities for cross sell and up sell• Isolated products ~ What is the opportunity ?

• Stage 2 : Customer plane displays clusters based on past transactions, demographics, conditions of purchase

•Stage 2 : Linking of customers to recommended products ~ combination of information retrieval and collaborative filtering via neural networks.

•Separate treatment for low and high degree associations.•Stage 3 : Validation of recommendation engine

• Precision• Recall

Page 2: Hybrid Recommendation Algorithm

Product Associations: Bundles, Bridge, Neighbours & Phrase

Product plane

Customer plane

Product Filters• Laptops• Mobile phones• AccessoriesCustomer Filters• Urban Cities – Tier 1 • High Income GroupCondition Filters•Pre Festival season• Mobile App purchases• Evening 6pm – 9 pm

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Recommendations from customer plane to product plane

Product plane

Customer plane

Product Filters• Laptops• Mobile phones• AccessoriesCustomer Filters• Urban Cities – Tier 1 • High Income GroupCondition Filters•Pre Festival season• Mobile App purchases• Evening 6pm – 9 pm

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Final Output

Customer ID ProductProbability of purchase Price point

Time point of analysis

A123 Moto G 55% 12,000Pre Diwali

2015

A123San Disk 6 GB

flash drive 87% 2500Pre Diwali

2015

A123Philips

Headphones 95% 3000Pre Diwali

2015