Rights statement: This is the author’s version of a work that was accepted for publication in International Journal of Forecasting. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in International Journal of Forecasting, 36, 3, 2020 DOI: 10.1016/j.ijforecast.2019.08.012
Accepted author manuscript, 2.3 MB, PDF document
Available under license: CC BY-NC-ND: Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License
Final published version
Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
}
TY - JOUR
T1 - Forecasting third-party mobile payments with implications for customer flow prediction
AU - Ma, S.
AU - Fildes, R.
N1 - This is the author’s version of a work that was accepted for publication in International Journal of Forecasting. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in International Journal of Forecasting, 36, 3, 2020 DOI: 10.1016/j.ijforecast.2019.08.012
PY - 2020/7/1
Y1 - 2020/7/1
N2 - Forecasting customer flow is key for retailers in making daily operational decisions, but small retailers often lack the resources to obtain such forecasts. Rather than forecasting stores’ total customer flows, this research utilizes emerging third-party mobile payment data to provide participating stores with a value-added service by forecasting their share of daily customer flows. These customer transactions using mobile payments can then be utilized further to derive retailers’ total customer flows indirectly, thereby overcoming the constraints that small retailers face. We propose a third-party mobile-payment-platform centered daily mobile payments forecasting solution based on an extension of the newly-developed Gradient Boosting Regression Tree (GBRT) method which can generate multi-step forecasts for many stores concurrently. Using empirical forecasting experiments with thousands of time series, we show that GBRT, together with a strategy for multi-period-ahead forecasting, provides more accurate forecasts than established benchmarks. Pooling data from the platform across stores leads to benefits relative to analyzing the data individually, thus demonstrating the value of this machine learning application.
AB - Forecasting customer flow is key for retailers in making daily operational decisions, but small retailers often lack the resources to obtain such forecasts. Rather than forecasting stores’ total customer flows, this research utilizes emerging third-party mobile payment data to provide participating stores with a value-added service by forecasting their share of daily customer flows. These customer transactions using mobile payments can then be utilized further to derive retailers’ total customer flows indirectly, thereby overcoming the constraints that small retailers face. We propose a third-party mobile-payment-platform centered daily mobile payments forecasting solution based on an extension of the newly-developed Gradient Boosting Regression Tree (GBRT) method which can generate multi-step forecasts for many stores concurrently. Using empirical forecasting experiments with thousands of time series, we show that GBRT, together with a strategy for multi-period-ahead forecasting, provides more accurate forecasts than established benchmarks. Pooling data from the platform across stores leads to benefits relative to analyzing the data individually, thus demonstrating the value of this machine learning application.
KW - Analytics
KW - Big data
KW - Customer flow forecasting
KW - Machine learning
KW - Forecasting many time series
KW - Multi-step-ahead forecasting strategy
U2 - 10.1016/j.ijforecast.2019.08.012
DO - 10.1016/j.ijforecast.2019.08.012
M3 - Journal article
VL - 36
SP - 739
EP - 760
JO - International Journal of Forecasting
JF - International Journal of Forecasting
SN - 0169-2070
IS - 3
ER -