Lookup Model for Most Popular Product
A lookup model partitions the data into non-overlapping groups, and then assigns a constant value within each group. Lookup models do not look like fancy statistical models, because they pre-calculate all the possible scores, rather than estimating coefficients for a complicated equation.
The first example of a lookup model finds the most popular product group in a zip code using the purchases data. This model is a profiling model, as opposed to a predictive model.
Most Popular Product
The most popular product group in a zip code is easy to determine. The model itself is a lookup table with two columns: a zip code and a product group. Using the model simply requires looking up the appropriate value in the table, using the customer’s zip code.
Once upon a time, a company was customizing its email offers. One of the things known about prospects was their zip codes. The marketing idea was to customize each email by including information about...