Complements are two objects in an Itemset that have a strong affinity for each other. They tend to occur simultaneously in the same Itemset. The knowledge that two objects have a strong tendency to occur simultaneously is a golden opportunity for any enterprise. If the simultaneous occurrence of the two objects is advantageous to the enterprise, then the enterprise need only expend resources to cause one of the two objects. The enterprise does not need to expend the resources to cause both to occur. If the second object is going to simultaneously occur with the first object, then any incremental expense or opportunity missed to cause the second object to occur is unnecessary. Instead, the enterprise should expend its resources to make the first object occur, and then let the second object occur simultaneously with the first object. In other words, if it’s good, and it will happen, let it happen.

If, however, the simultaneous occurrence of the two objects in an Itemset is disadvantageous to the enterprise, the enterprise is equipped with the knowledge that a disadvantageous scenario has a strong tendency to occur. The enterprise can then choose to either prevent the simultaneous occurrence of objects or leverage the simultaneous occurrence of objects. If the enterprise is able to prevent the second object from occurring, but at an incremental cost, then the enterprise can choose to either expend the resources necessary to prevent the second object from occurring simultaneously with the first object or the enterprise can choose to absorb the simultaneous occurrence of the second object. The question is, Which has the higher cost, the prevention or the problem? Problems do exist that cost more than their prevention. So, in the case of a disadvantageous Complement, an action can be to either tolerate the co-occurrence of the objects in an Itemset or prevent the co-occurrence of the objects in an Itemset.

Another action to be taken in the case of a disadvantageous Complement is to leverage one of the two objects. An example of the leverage of a disadvantageous Complement is a tariff, that is, a tax on imported products. A tariff is levied on imported products to increase the price of those products when they sell in a retail store. In this situation, the two objects are (1) imported products and (2) reduced sales of domestic products and the Itemset is a fiscal period (e.g., fiscal quarter, fiscal year), which is measured by the GDP of the fiscal period. The disadvantageous Complement is caused when an imported, rather than domestic, product sells in the retail market. The domestic government prefers that domestic products sell as much as possible. A tariff works to prevent the presence of imported product in retail stores, which is expected to cause the sale of domestic products to increase. The use of a tariff also has the added benefit of increasing the revenues of the domestic government.

In an enterprise disadvantageous Complements will occur. If the disadvantageous Complement cannot be prevented, and the cost is intolerably high, then it should be leveraged. Like the tariff, the enterprise can respond to the disadvantageous Complement by modifying the situation to generate, or minimize the disadvantage, as much as possible. Finding the leverage to apply in such a situation may require creativity and ingenuity. The actionable knowledge is the awareness that the Complement is disadvantageous to the enterprise, and that the cost of preventing it is too high, and that it should be leveraged in some way.

Substitutes are two objects in an Itemset that have a strong affinity to not occur in the same Itemset, that is, they avoid each other. The knowledge that the two objects have a strong tendency to avoid each other is another opportunity for the enterprise. Knowing that two objects avoid each other, the enterprise can choose to let the two objects always remain separate, or try to join them together in an Itemset.

If the co-occurrence of two objects is advantageous to the enterprise, yet expensive to facilitate, then the question is, Which is more expensive, the missed opportunity when the two objects avoid each other or the cost of facilitating the co-occurrence of the two objects? This may be a quantitative question that can be answered in fiscal numbers, or this may be a value judgment that can only be measured in the intangible asset of the enterprise. Either way, the awareness of the two objects that are Substitutes, and the opportunity it creates, is an actionable knowledge delivered by Market Basket Analysis.

The more ubiquitously understood manifestation of Substitutes is cannibalism. This occurs when an action that increases the occurrence of object A also decreases the occurrence of object B. This is called cannibalism because the enterprise eats away from one part of itself to feed another part of itself. The eating away is the decreased occurrence of object B. The feeding is the increased occurrence of object A. The awareness of two Substitutes (e.g., objects A and B) helps the enterprise understand the consequences of its own actions. This awareness is the opportunity to choose between the two options. If the advantage of increased occurrences of object A compensates for the decreased occurrences of object B, then the enterprise can tolerate the increased occurrence of object A. If, however, the advantage of increased occurrences of object A is not sufficient to compensate for the decreased occurrences of object B, then the enterprise can choose to take no actions on objects A and B, allowing them to achieve their natural equilibrium.

An Independent object is a single object that has no strong affinity to co-occur or avoid any other object in an Itemset. An Independent object occurs in an equilibrium proportion of Itemsets, regardless of what else is in the Itemsets. An Independent object is going to occur as often as it occurs because, for some reason that may or may not be known, it is natural for that Independent object to occur. The knowledge that an object naturally occurs in Itemsets with, and without, the intervention of the enterprise is yet one more opportunity discovered by Market Basket Analysis. If an Independent object is advantageous to the enterprise, the enterprise cannot increase the occurrence of the Independent object by increasing the occurrence of a correlating object because there is no correlating object. The enterprise can, however, increase the opportunity for the Independent object to occur.

A good example of the increased opportunity of an Independent object to naturally occur is all the “impulse buy” products conspicuously displayed immediately in front of every cash register in every grocery store. Impulse buying activity occurs because...well, because the impulse to buy candy bars and soft drinks naturally occurs. Usually the impulse buyer is a child. A parent has been shopping for groceries with a child in the grocery cart. Throughout the entire store the child has been asking for one thing, wanting another thing, grabbing something else, and on and on it goes...until they get to the cash register. At the cash register the child finds a cornucopia of candy and goes berserk. At that moment, the parent can buy two minutes of peace and quiet for the price of a candy bar. Neither the parent nor the child equates the candy bar with the contents of the grocery cart. No, instead the candy bar is purchased simply to appease the child. That is a naturally occurring Independent object.

If, however, the occurrence of an Independent object is disadvantageous to the enterprise, then the enterprise can attempt to reduce the opportunities for that Independent object to occur. A good example of reduced opportunities is safety equipment. Accidents naturally occur. Rather than present a naturally occurring accident with a soft piece of human flesh to rip, cut, smash, or tear, we wear safety equipment. A carpenter wears safety goggles to reduce the opportunity for wood chips to fly into an eyeball and cause blindness. Wood chips occur regardless of the kind of wood being cut, and the equipment performing the cut, and the environment surrounding the cut, and...well, wood chips just have a natural tendency to fly. Rather than present two eyeballs as an opportunity for an accident, a carpenter wears safety goggles. A butcher wears safety gloves to reduce the opportunities to cut off a finger. A construction worker wears a hard hat to reduce the opportunities to catch a falling bolt with a skull. These examples show how an enterprise can respond to an Independent object by reducing the opportunity for that Independent object to occur.

An enterprise cannot discourage the occurrence of a disadvantageous Independent by inhibiting a strongly correlated object from occurring because no strongly correlated object exists. In such cases the enterprise is left to deal directly with the Independent object. The enterprise can choose to either discourage the occurrence of the Independent object by removing the opportunities for it to occur, or the enterprise can attempt to shield itself from the effects of the Independent object. Despite how bad this may seem, the ROI in this situation is the awareness that the enterprise is dealing directly with an Independent object, that only a direct approach will work because there is no correlating object to attack. Instead, the enterprise can be aware that an end-run gambit is a waste of time and resources, and that a direct approach is necessary.

Complement objects, Substitute objects, and Independent objects are the actionable knowledge most frequently associated with Market Basket Analysis. The discovery of such objects and their affinities provides insight into the equilibriums within and around the enterprise. These affinities demonstrate the equilibrium between objects. For example, four quarts of motor oil and one oil filter would be a natural Itemset for an oil change. For that Itemset, the equilibrium between quarts of motor oil and oil filters is four to one—that is, four quarts of oil to one oil filter.

Some of the object affinities will probably be key indicators of the life and health of the enterprise. Such indicators may be able to predict the upcoming health of the enterprise. Others may only confirm the current state of the enterprise. Either way, the KPIs can be predefined and executed daily in a batch environment. That way, the KPIs can be monitored passively by reviewing the output when an analyst is available to review the results of the Market Basket Reporting.

Market Basket Reporting operates in a batch environment so that it can monitor KPIs with no manual intervention. The KPIs can themselves be monitored to raise awareness when the affinity, or lack of affinity, of an object or group of objects changes. The problem may be caused by misplaced product or incorrectly labeled product, expired product or too much product, or any of any almost infinite number of causes that could influence affinities within the enterprise. The causes of a fluctuation in the affinities of an enterprise, however, will never be found unless someone knows to look for them. No one will know to look for those affinities within and around the enterprise until an automated KPI notices that something has changed.

That is the final ROI of Market Basket Analysis—affinity KPIs in Market Basket Reporting. Even if no actions arise from the Market Basket Analysis, the enterprise will be able to monitor via automated jobs the affinities between objects inside and outside the enterprise.