The retail industry has built significant infrastructure to capture data about product sales for business purposes. Retailers analyze sales data for supply chain management and to make decisions, such as which product lines to carry in which stores, how and when to promote products, which stores to close, and where to open new stores.
The vast majority of retailers in the United States collect sales data using optical cash registers. Clerks scan the familiar barcode imprinted on every product (Figure 22.1) at the point of purchase. The barcode encodes a standard product identifier called the Global Trade Item Number or GTIN.1
The cash register either records sales in the store's computer in real time or stores the records for periodic automatic transfer to the store's central computer. The cash register and store computer record all products purchased in a single transaction, which is sometimes referred to as a market basket. If the customer presents a loyalty card, then the cash register and store computer also record the customer number associated with the card. On a daily or more frequent basis, the store computer transmits these sales data to a central data warehouse operated by the retail chain. Thousands of stores may send data to a single data warehouse.
The data that retailers collect are quite detailed. They include a record of each check-out, including the GTIN for each item in the set of items purchased (the market basket), the quantity of each item, the time of purchase, and—if the customer used a loyalty card or credit card when making the purchase—some indication of the identity of the purchaser. Retailers collect these data at the moment of purchase. Retailers also have electronic records of which items were being promoted at the time of the sale, which may be useful in distinguishing a spike in sales due to disease from a spike in sales due to promotion.
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