Evaluation of Discount Effects Using Poisson Regression Based on Interaction Effects between Bargain Scale and Product Category

In grocery stores, discount flyers act as important tools to provide discount information to customers and increase their purchasing motivation. However, limited space is available on discount flyers. Furthermore, because customers purchase popular products even if they are not actively being promoted, mentioning them on discount flyers is an ineffective strategy. Therefore, the proper allocation of discounted products is an important topic in the field of category management. In this paper, we propose a method to determine the share of product categories that should be included on discount flyers using a poisson regression model based on an interaction effect between sales area and bargain scale. The proposed method utilizes radio frequency identification (RFID), point of sales (POS), and discount flyer data and predicts the number of products that will be purchased. The experimental results show that Western Deli and Drink products have a significant interaction effect on bargain sales, suggesting that the implementation of discounts in these sales areas is expected to generate an increase in sales relative to other sales areas.