Predicting the Next Best Product for Your Customers: A Hyperlinkset

The core of Istobe’s technology is an engine that predicts the next product or product category that a customer wants, a la Amazon or Netflix. However, we try to make this technology more applicable to other processes within the retail realm, such as direct marketing and merchandising, by looking at actual sales data. The typical recommendation engine (like richrelevance) only lends itself to realities in the online world, since they take advantage of website data exclusively. The Istobe engine is a bit more universal, using actual sales transactions to build models and predictions. In either case, the goal of either approach is to predict the next best product for your customers. I’ve compiled a good starter kit containing three links for retailers and others who may be interested in learning about Next Best Product approaches.

MIT Sloan Management Review article

The MIT Sloan Management Review just released a great article on the science behind predicting the next best product for customers. Both a primer and a graduated piece, the Review leaves nothing uncovered, roving from Will Smith to actual formulas and back again. Registration required. But worth it.

Excerpt from Strategic Database Marketing by Arthur Hughes

This, found in the seminal database marketing book, Strategic Database Marketing by Arthur Hughes, is the classic definition of next best product. It has great use cases for a next best product approach. Thanks Arthur. Link takes you to the specific section of Strategic Database Marketing at Google Book Search.

From the Database Marketing Institute.

This quick piece from the Database Marketing Institute was just released and provides a good example of how next best product works as a tool for sales enablement using a share of wallet comparison approach to the next best product. Not horribly sophisticated but adequate.

Tags: next best product, product recommendations

Add Personalized Product Recommendations to Your eCommerce Site

Istobe is a powerful recommendation engine that makes it easy to add recommendations to your eCommerce site. How powerful? Shoppers who click on Istobe recommendations spend 20-50% more than the average visitor.

This entry was posted on Monday, January 12th, 2009 at 11:39 pm and is filed under Data Mining, Predictive Analytics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.