The probabilistic customer purchase evolution graph

Following evolutionary theory, this study defines the commodity consumption gene of the customer journey in retail transactions to discuss the distribution and evolution process of the consumer group. First, through relevant retail research, each transaction is defined as a data point in the SPC space (Sales-Product-Customer). The customer journey is a pivot transformation of the transaction data points in the SPC space. Customer purchase products are defined as consumption genes in the customer journey, forming customer consumption species. Furthermore, evolutionary operations with probabilities between consumer species (genes) can be used to analyze the evolution of each customer’s purchase consumption over time in the retail database. An algorithm for the Customer Purchase Evolution Graph (CPEG) is proposed. To prove practicability, nearly 300,000 actual transactions from over 27,000 consumers are used to establish the CPEGs with evolutionary probabilities of the overall customers and the CPEG of the SVIP. The CPEG of all customers can be used to determine the main consumption distribution, main consumption starting point (first purchase) behavior, and repurchase behavior of all customers and new customers. The CPEG of SVIP customers can further reveal the main consumption genes of mature customers (species) and the evolution process of their consumption journey. These findings can be of specific help in a company’s commodity strategy and operational marketing.