Market Basket

Analysis

By
Sowjanya Alaparthi

Topics to be
discussed
Introduction to Market basket
analysis
Apriori Algorithm
Demo-1 ( Using self created table)
Demo-2 ( Using Oracle sample
schema)
Demo-3 ( Using OLAP analytic
workspace)

Introduction to Market
Basket Analysis
Def: Market Basket Analysis
(Association Analysis) is a mathematical
modeling technique based upon the
theory that if you buy a certain group of
items, you are likely to buy another
group of items.
It is used to analyze the customer
purchasing behavior and helps in
increasing the sales and maintain
inventory by focusing on the point of sale
transaction data.
Given a dataset, the Apriori Algorithm
trains and identifies product baskets and
product association rules

Definitions and
Terminology
Transaction is a set of items (Itemset).
Confidence : It is the measure of uncertainty or
trust worthiness associated with each
discovered pattern.
Support : It is the measure of how often the
collection of items in an association occur
together as percentage of all transactions
Frequent itemset : If an itemset satisfies
minimum support,then it is a frequent itemset.
Strong Association rules: Rules that satisfy both
a minimum support threshold and a minimum
confidence threshold
In Association rule mining, we first find all
frequent itemsets and then generate strong
association rules from the frequent itemsets

Definitions and
Terminology- Continued
Apriori algorithm is the most
established algorithm for finding
frequent item sets mining.
The basic principle of Apriori is Any
subset of a frequent itemset must
be frequent.
We use these frequent itemsets to
generate association rules.

Apriori Algorithm
Ck: Candidate itemset of size k
Lk: Frequent itemset of size k
L1={frequent items};
For (k=1; Lk!=0; k++) do begin
Ck+1= Candidates generated from Lk;
For each transaction t in the database do
Increment the count of all candidates in Ck+1 that
are contained in t
Lk+1=candidates in Ck+1 with min_support
End
Return UkLk;

Pictorial representation
of Apriori algorithm
Step 1
Scan the transaction
database to get the support
S of each 1-itemsets,
compare S with min _sup,
and get a set of frequent 1itemsets,L1

Step 3
Scan the transaction database to
get the support S of each candidate
k-itemset in the final set, compare
S with min_sup, and get a set of
frequent k-itemsets,Lk

Step 2
Use Lk-1 join Lk-1 to generate
a candidate k-itemsets. And
use appiori propersty to prune
the unfrequented k-itemssets
from this set.

NO

Step 4
The candidate
set = null

YES

Step 6
For every non empty
subset s of 1, output the
rule s =>(1-s) if
confidence C of the rule
s=> (1-s)(=support S
of 1/support S of s )3

Step 5
For each frequent
itemset 1,
generate all non
empty subsets of 1

Demo-1
Installations
Oracle 10g enterprise edition
SQL Plus
Oracle Data Miner Client

Demo 1 - Data
Preparation
Download the sample data, which is
in excel sheet.
write macro to convert data in excel
sheet to insert queries
Create a table and execute these
insert queries in SQLplus
As we are connected to Oracle
server, this table is then found in
Oracle database

Demo-1 Connections
Connect Oracle Data Miner Client to
Oracle Database
Make sure the oracle listener is
listening
Database instance ora478 is
started.
The port used is 1521
Give the hostname as
oracle.itk.ilstu.edu

Demo-1
Perform the activity, after
installations and connections are
made.

Demo-2
( using oracle sample
schema)
Download Oracle 10g on your system
and install it
Select the sample schema option during
the custom installation
Launch Oracle Data Miner Client
In order to use this sample scheme for
our activity, we should have the system
administrator privileges.
The username is SH and password is
password

Demo -2
Administrator should perform some grants in
sqlplusw to build this activity. They are
alter user sh account unlock;
alter user sh identified by password;
grant create table to sh;
grant create sequence to sh;
grant create session to sh;
grant create view to sh;
grant create procedure to sh;
grant create job to sh;
grant create type to sh;
grant create synonym to sh;
grant execute on ctxsys.ctx_ddl to sh;

Demo-2
The points to be noted before starting
the activity are:
Make sure the oracle listener is
started
Database instance ORCL is
started.
The port used is 1521
Give the hostname as 127.0.0.1,
which is a general hostname.

Demo-2
Finally, the results from the model
are published to a table, and this
table forms the raw source for the
new OLAP product dimension.
At this point there is no information
relating to revenue, costs or
quantity. So, we need to extend the
activity beyond association analysis
to OLAP.

OLAP
We have to correctly format the
results obtained from Association
analysis for dimension mapping in
OLAP. This can be done using
OLAP DML or PL/SQL.
In our activity we create a separate
dimension that can hold the results
from algorithm. For each dimension
we can create Levels, hierarchies,
attributes and mappings.

OLAP- Analytic
workspace
Launch Analytic workspace and
give the login details as
Username- sh
Connection information127.0.0.1:1521:orcl
This connects to Oracle sample
schema SH on 1521 port and local
host 127.0.0.1 and orcl database
instance.

Demo 3- OLAP Analytic

Workspace
Perform the activity and show the
mappings

Conclusion
We have shown how Market basket
analysis using association rules
works in determining the customer
buying patterns. This can be further
extended using OLAP Analytic
workspace as shown in demo-3, to
add dimensions and cube to identify
other measures like costs, revenue
and quantity.

References
Books:
[1] Michael J. A. Berry, Gordon Linoff.Data Mining Techniques:
For Marketing, Sales, and Customer Support (Paperback).
[2] J.Han,M. Kamber(2001) Data Mining, Morgan Kaufmann
publishers, San Francisco,CA
Links:
[3]. http://oraclebi.blogspot.com/2007/02/using-market-basketanalysis-to-add.html
[4]. http://nymetro.chapter.informs.org/prac_cor_pubs/AuslederOn-market-basket-analysis-May-04.pdf
[5]. http://www2.sas.com/proceedings/sugi28/223-28.pdf
[6] http://en.wikipedia.org/wiki/Market_basket_analysis
[7]
http://www.cs.ualberta.ca/~zaine/courses/cmput499/slides/lect1
0/sld053.htm
[8] http://www.icaen.uiowa.edu/~comp/Public/Apriori.pdf

Questions??