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A Market Basket Analysis Conducted with a Multivariate Logit Model

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  • Yasemin Boztug
  • Lutz Hildebrandt

Abstract

The following research is guided by the hypothesis that products chosen on a shopping trip in a supermarket can indicate the preference interdependencies between different products or brands. The bundle chosen on the trip can be regarded as the result of a global utility function. More specifically: the existence of such a function implies a cross-category dependence of brand choice behavior. It is hypothesized that the global utility function related to a product bundle results from the marketing-mix of the underlying brands. Several approaches exist to describe the choice of specific categories from a set of many alternatives. The models are discussed in brief; the multivariate logit approach is used to estimate a model with a German data set.

Suggested Citation

  • Yasemin Boztug & Lutz Hildebrandt, 2005. "A Market Basket Analysis Conducted with a Multivariate Logit Model," SFB 649 Discussion Papers SFB649DP2005-028, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
  • Handle: RePEc:hum:wpaper:sfb649dp2005-028
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    File URL: http://sfb649.wiwi.hu-berlin.de/papers/pdf/SFB649DP2005-028.pdf
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    References listed on IDEAS

    as
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    5. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521747387, January.
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    Cited by:

    1. Yasemin Boztug & Thomas Reutterer, 2006. "A Combined Approach for Segment-Specific Analysis of Market Basket Data," SFB 649 Discussion Papers SFB649DP2006-006, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.

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    More about this item

    Keywords

    market basket analysis; multivariate logit model; brand choice behavior; marketing-mix;
    All these keywords.

    JEL classification:

    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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