WHY DO MULTI-VARIATE ANALYSIS
- Every data-set comprises of multiple variables, so we need to understand how the multiple variables interact with each other.
- After we understand uni-variate analysis – where we understand the behaviour of each distribution, and bi-variate analysis – where we understand how each variable relates to the other variables; we need to understand what behaviour change will happen in the trend on introduction of more variables.
- Multi-variate analysis has good application in clustering, where we need to visualize how multiple variables show different patterns in different clusters.
- When there are too many inter-correlated variables in the data, we’ll have to do a dimensionality reduction through techniques like Principal Component Analysis and Factor Analysis. We will cover Dimensionality Reduction Techniques in different post.
We will illustrate multi-variate analysis with the following case study:
Data:
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data<-read.csv("https://storage.googleapis.com/dimensionless/Blog/cust.csv") |
Each row corresponds to annual spending by different customers of a whole sale distributor who sells milk / fresh grocery frozen detergent papers and delicassen in 3 different regions – Linson, Aporto and Others (Coded 1/2/3 respectively) through 2 different channels – Horeca (Hotel / Restaurant / Cafe) or Retail Channel (Coded 1/2 respectively)
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head(data) |
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## Channel Region Fresh Milk Grocery Frozen Detergents_Paper Delicassen ## 1 2 3 12669 9656 7561 214 2674 1338 ## 2 2 3 7057 9810 9568 1762 3293 1776 ## 3 2 3 6353 8808 7684 2405 3516 7844 ## 4 1 3 13265 1196 4221 6404 507 1788 ## 5 2 3 22615 5410 7198 3915 1777 5185 ## 6 2 3 9413 8259 5126 666 1795 1451 |
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summary(data) |
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## Channel Region Fresh Milk ## Min. :1.000 Min. :1.000 Min. : 3 Min. : 55 ## 1st Qu.:1.000 1st Qu.:2.000 1st Qu.: 3128 1st Qu.: 1533 ## Median :1.000 Median :3.000 Median : 8504 Median : 3627 ## Mean :1.323 Mean :2.543 Mean : 12000 Mean : 5796 ## 3rd Qu.:2.000 3rd Qu.:3.000 3rd Qu.: 16934 3rd Qu.: 7190 ## Max. :2.000 Max. :3.000 Max. :112151 Max. :73498 ## Grocery Frozen Detergents_Paper Delicassen ## Min. : 3 Min. : 25.0 Min. : 3.0 Min. : 3.0 ## 1st Qu.: 2153 1st Qu.: 742.2 1st Qu.: 256.8 1st Qu.: 408.2 ## Median : 4756 Median : 1526.0 Median : 816.5 Median : 965.5 ## Mean : 7951 Mean : 3071.9 Mean : 2881.5 Mean : 1524.9 ## 3rd Qu.:10656 3rd Qu.: 3554.2 3rd Qu.: 3922.0 3rd Qu.: 1820.2 ## Max. :92780 Max. :60869.0 Max. :40827.0 Max. :47943.0 |
PROCEDURE TO ANALYZE MULTIPLE VARIABLES
I. TABLES
Tables can be generated using xtabs function, tapply function, aggregate function and dplyr library
To get the spending on milk channel-wise and region-wise, using xtabs function
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t=xtabs(data$Milk~data$Channel+data$Region) |
To get percentage spending
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round(t/sum(data$Milk, na.rm=T),2) |
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## data$Region ## data$Channel 1 2 3 ## 1 0.09 0.03 0.29 ## 2 0.08 0.07 0.45 |
To get %age spending on grocery channel-wise and region-wise, using aggregate function
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agg=aggregate(data$Grocery, by=list(Channel=data$Channel, Region=data$Region), sum,na.rm=T) names(agg)[3]="Grocery" agg$Ptage_Expense=round(agg$Grocery/sum(data$Grocery, na.rm=TRUE),2) agg |
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## Channel Region Grocery Ptage_Expense ## 1 1 1 237542 0.07 ## 2 2 1 332495 0.10 ## 3 1 2 123074 0.04 ## 4 2 2 310200 0.09 ## 5 1 3 820101 0.23 ## 6 2 3 1675150 0.48 |
To get %age spending on frozen channel-wise and region-wise, using tapply function
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b=tapply(data$Frozen, list(Region=data$Region, Channel=data$Channel),sum , na.rm=TRUE) |
Percentage spending
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round(b/sum(data$Frozen, na.rm=TRUE),2) |
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## Channel ## Region 1 2 ## 1 0.14 0.03 ## 2 0.12 0.02 ## 3 0.57 0.12 |
To get %age spending on detergent_paper channel-wise and region-wise, using dplyr library
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library(dplyr) |
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## ## Attaching package: 'dplyr' |
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## The following objects are masked from 'package:stats': ## ## filter, lag |
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## The following objects are masked from 'package:base': ## ## intersect, setdiff, setequal, union |
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data%>%group_by(Channel,Region)%>%summarise(Detergents_Paper=sum(Detergents_Paper))->agg agg$Ptage_Expense=round(agg$Detergents_Paper/sum(data$Detergents_Paper, na.rm = TRUE),2) agg |
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## Source: local data frame [6 x 4] ## Groups: Channel [?] ## ## Channel Region Detergents_Paper Ptage_Expense ## <int> <int> <int> <dbl> ## 1 1 1 56081 0.04 ## 2 1 2 13516 0.01 ## 3 1 3 165990 0.13 ## 4 2 1 148055 0.12 ## 5 2 2 159795 0.13 ## 6 2 3 724420 0.57 |
II. STATISTICAL TESTS
Anova
Anova can be used to understand, how a continuous variable is dependent on categorical independent variables.
In the following code we are trying to understand if sales of milk is a function of Region and Channel and their interaction.
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res<-aov(Milk~Region + Channel + Region:Channel,data=data) summary(res) |
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## Df Sum Sq Mean Sq F value Pr(>F) ## Region 1 2.493e+07 2.493e+07 0.577 0.448 ## Channel 1 5.051e+09 5.051e+09 116.987 <2e-16 *** ## Region:Channel 1 1.134e+07 1.134e+07 0.263 0.609 ## Residuals 436 1.882e+10 4.318e+07 ## --- ## Signif. codes: 0 '***' 0.001 '**' 0.01 '*' 0.05 '.' 0.1 ' ' 1 |
This shows that expense of milk is dependent on channel
Chi-Square Test
Chisquare Test to understand the association between 2 factor variables
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dat=table(Channel=data$Channel, Region=data$Region) chisq.test(dat) |
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## ## Pearson's Chi-squared test ## ## data: dat ## X-squared = 4.3491, df = 2, p-value = 0.1137 |
Probability is very high, 11.37%, hence we fail to reject the null hypothesis. Hence, we conclude that there is no association between channel and region.
III. CLUSTERING
Multi-Variate analysis has a very wide application in unsupervised learning. Clustering has the maximum applications of multi-variate understanding and visualizations. Many times we prefer to perform clustering before applying the regression algorithms to get more accurate predictions for each cluster.
We will do hierarchical clustering for our case study, using the following steps:
1. Seperating the columns to be analyzed
Let’s get a sample data comprising of all the items whose expenditure is to be analyzed i.e all columns except Channel and Region – like fresh, milk, grocery, frozen etc.
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names(data) |
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## [1] "Channel" "Region" "Fresh" ## [4] "Milk" "Grocery" "Frozen" ## [7] "Detergents_Paper" "Delicassen" |
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sample<-data[,3:8] names(sample) |
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## [1] "Fresh" "Milk" "Grocery" ## [4] "Frozen" "Detergents_Paper" "Delicassen" |
2. Scaling the data, to get all the columns into same scale. This is done using calculation of z-score:
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sample_scale=scale(sample, center=TRUE, scale=TRUE) sample=cbind(sample, sample_scale) |
3. Identifying the appropriate number of clusters for k-means clustering
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library(NbClust) noculs <- NbClust(sample_scale, distance = "euclidean", min.nc = 2, max.nc = 12, method = "kmeans") <img class=" wp-image-1322 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-1-300x214.png" alt="multi variate analysis" width="516" height="368" /> |
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## *** : The Hubert index is a graphical method of determining the number of clusters. ## In the plot of Hubert index, we seek a significant knee that corresponds to a ## significant increase of the value of the measure i.e the significant peak in Hubert ## index second differences plot. ## <img class=" wp-image-1324 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-300x214.png" alt="multi variate analysis" width="466" height="332" /> |
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## *** : The D index is a graphical method of determining the number of clusters. ## In the plot of D index, we seek a significant knee (the significant peak in Dindex ## second differences plot) that corresponds to a significant increase of the value of ## the measure. ## ## ******************************************************************* ## * Among all indices: ## * 6 proposed 2 as the best number of clusters ## * 4 proposed 3 as the best number of clusters ## * 3 proposed 4 as the best number of clusters ## * 3 proposed 5 as the best number of clusters ## * 1 proposed 7 as the best number of clusters ## * 4 proposed 10 as the best number of clusters ## * 3 proposed 12 as the best number of clusters ## ## ***** Conclusion ***** ## ## * According to the majority rule, the best number of clusters is 2 ## ## ## ******************************************************************* |
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table(noculs$Best.nc[1,]) |
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## ## 0 2 3 4 5 7 10 12 ## 2 6 4 3 3 1 4 3 |
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barplot(table(noculs$Best.nc[1,]), xlab="Numer of Clusters", ylab="Number of Criteria", main="Number of Clusters Chosen") <img class=" wp-image-1325 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-2-1-300x214.png" alt="multi variate analysis" width="471" height="336" /> |
Though 2 clusters / 3 clusters show the maximum variance. In this case-study we are deviding the data into 10 clusters to get more specific results, visualizations and target strategies.
We can also use within-sum-of-squares method to find the number of clusters.
Also read:
Data Exploration and Uni-Variate Analysis
Bi-Variate Analysis
Data-Cleaning, Categorization and Normalization
4. Finding the most suitable number of clusters through wss method
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wss<-1:15 for (i in 1:15) { wss[i]<-kmeans(sample[,7:12],i)$tot.withinss } wss |
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## [1] 2634.0000 1949.3479 1638.5026 1353.8722 1240.8142 1125.9104 862.4485 ## [8] 773.6659 689.2003 597.5906 564.9160 526.6801 482.9415 481.6230 ## [15] 468.0860 |
5. Plot wss using ggplot2 Library
We will plot the within-sum-of-squares distance using ggplot library:
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number<-1:15 library(ggplot2) dat<-data.frame(wss,number) dat |
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## wss number ## 1 2634.0000 1 ## 2 1949.3479 2 ## 3 1638.5026 3 ## 4 1353.8722 4 ## 5 1240.8142 5 ## 6 1125.9104 6 ## 7 862.4485 7 ## 8 773.6659 8 ## 9 689.2003 9 ## 10 597.5906 10 ## 11 564.9160 11 ## 12 526.6801 12 ## 13 482.9415 13 ## 14 481.6230 14 ## 15 468.0860 15 |
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p<-ggplot(dat,aes(x=number,y=wss),color="red") p+geom_point()+scale_x_continuous(breaks=seq(1,20,1))+scale_y_continuous(breaks=seq(500,3000,500)) <img class=" wp-image-1326 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-3-300x214.png" alt="multi variate analysis" width="523" height="373" /> |
We notice that after cluster 10, the wss distance increases drastically. So we can choose 10 clusters.
5. Dividing data into 10 clusters
We will apply kmeans algorithm to divide the data into 10 clusters:
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set.seed(200) fit.km<-kmeans(sample[,7:12],10) sample$cluster=fit.km$cluster |
6. Checking the Attributes of k-means Object
We will check the centers and size of the clusters
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attributes(fit.km) |
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## $names ## [1] "cluster" "centers" "totss" "withinss" ## [5] "tot.withinss" "betweenss" "size" "iter" ## [9] "ifault" ## ## $class ## [1] "kmeans" |
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fit.km$centers |
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## Fresh Milk Grocery Frozen Detergents_Paper ## 1 0.7918828 0.5610464 -0.01128859 9.24203651 -0.4635194 ## 2 0.7108765 -0.2589259 -0.27203848 -0.20929524 -0.3530279 ## 3 1.9645810 5.1696185 1.28575327 6.89275382 -0.5542311 ## 4 1.0755395 5.1033075 5.63190631 -0.08979632 5.6823687 ## 5 -0.4634131 -0.4587350 -0.52211820 -0.28548405 -0.4501496 ## 6 -0.5526133 0.4194314 0.51079792 -0.30950259 0.4915742 ## 7 0.2370851 -0.2938321 -0.42497950 1.43457516 -0.4926072 ## 8 3.0061448 1.6650889 0.98706324 1.09668928 0.1840989 ## 9 2.7898027 -0.3572603 -0.37008492 0.46561695 -0.4540498 ## 10 -0.5039508 1.4484898 1.97086631 -0.27885432 2.2070700 ## Delicassen ## 1 0.932103121 ## 2 0.051489721 ## 3 16.459711293 ## 4 0.419817401 ## 5 -0.269307346 ## 6 -0.010691096 ## 7 -0.019489863 ## 8 4.237120807 ## 9 -0.008907628 ## 10 0.207301087 |
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fit.km$size |
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## [1] 2 78 1 5 167 93 43 4 20 27 |
7. Visualizing the Clusters
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library(cluster) clusplot(sample, fit.km$cluster, main='2D representation of the Cluster solution', color=TRUE, shade=TRUE, labels=2, lines=0) <img class=" wp-image-1327 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-4-300x214.png" alt="multi variate analysis" width="488" height="348" /> |
7. Profiling Clusters
Getting Cluster-wise summaries through mean function
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cmeans<-aggregate(sample[,c(1:6)], by=list(sample$cluster), FUN=mean) cmeans |
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## Group.1 Fresh Milk Grocery Frozen Detergents_Paper ## 1 1 22015.500 9937.000 7844.000 47939.000 671.5000 ## 2 2 20990.987 3885.295 5366.051 2055.872 1198.3077 ## 3 3 36847.000 43950.000 20170.000 36534.000 239.0000 ## 4 4 25603.000 43460.600 61472.200 2636.000 29974.2000 ## 5 5 6139.359 2410.629 2989.503 1686.000 735.2455 ## 6 6 5011.215 8891.828 12805.473 1569.398 5225.2473 ## 7 7 14998.791 3627.674 3912.628 10036.326 532.8140 ## 8 8 50020.000 18085.250 17331.500 8396.000 3759.2500 ## 9 9 47283.850 3159.550 4434.300 5332.350 716.6500 ## 10 10 5626.667 16486.667 26680.741 1718.185 13404.4815 ## Delicassen ## 1 4153.5000 ## 2 1670.0769 ## 3 47943.0000 ## 4 2708.8000 ## 5 765.3952 ## 6 1494.7204 ## 7 1469.9070 ## 8 13474.0000 ## 9 1499.7500 ## 10 2109.4815 |
8. Population-Wise Summaries
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options(scipen=999) popln_mean=apply(sample[,1:6],2,mean) popln_sd=apply(sample[,1:6],2,sd) popln_mean |
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## Fresh Milk Grocery Frozen ## 12000.298 5796.266 7951.277 3071.932 ## Detergents_Paper Delicassen ## 2881.493 1524.870 |
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popln_sd |
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## Fresh Milk Grocery Frozen ## 12647.329 7380.377 9503.163 4854.673 ## Detergents_Paper Delicassen ## 4767.854 2820.106 |
9. Z-Value Normalisation
z score = (cluster_mean-population_mean)/population_sd
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list<-names(cmeans) for(i in 1:length(list)) { y<-(cmeans[,i+1] - popln_mean[i])/popln_sd[i] cmeans<-cbind(cmeans,y) names(cmeans)[i+length(list)]<-paste("z",list[i+1],sep="_") } cmeans=cmeans[,-length(names(cmeans))] cmeans[8:length(names(cmeans))] |
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## z_Fresh z_Milk z_Grocery z_Frozen z_Detergents_Paper ## 1 0.7918828 0.5610464 -0.01128859 9.24203651 -0.4635194 ## 2 0.7108765 -0.2589259 -0.27203848 -0.20929524 -0.3530279 ## 3 1.9645810 5.1696185 1.28575327 6.89275382 -0.5542311 ## 4 1.0755395 5.1033075 5.63190631 -0.08979632 5.6823687 ## 5 -0.4634131 -0.4587350 -0.52211820 -0.28548405 -0.4501496 ## 6 -0.5526133 0.4194314 0.51079792 -0.30950259 0.4915742 ## 7 0.2370851 -0.2938321 -0.42497950 1.43457516 -0.4926072 ## 8 3.0061448 1.6650889 0.98706324 1.09668928 0.1840989 ## 9 2.7898027 -0.3572603 -0.37008492 0.46561695 -0.4540498 ## 10 -0.5039508 1.4484898 1.97086631 -0.27885432 2.2070700 ## z_Delicassen ## 1 0.932103121 ## 2 0.051489721 ## 3 16.459711293 ## 4 0.419817401 ## 5 -0.269307346 ## 6 -0.010691096 ## 7 -0.019489863 ## 8 4.237120807 ## 9 -0.008907628 ## 10 0.207301087 |
Where-ever we have very high z-scores it indicates, that cluster is different from the population. * Very-high z-score for fresh in cluster 8 and 9
* Very-high z-score for milk in cluster 5,6 and 9
* Very-high z-score for grocery in cluster 5 and 6
* Very-high z-score for frozen products in cluster 7, 9 and 10
* Very-high z-score for detergents paper in cluster 5 and 6
We would like to find why these clusters are so different from the population
IV. MULTI-VARIATE VISUALIZATIONS
- To understand the correlations between each column
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pairs(data[,-c(1,2,length(names(data)))]) <img class=" wp-image-1328 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-5-300x214.png" alt="multi variate analysis" width="520" height="371" /> |
We observe positive correlation between:
- Milk & Grocery
- Milk & Detergents_Paper
- Grocery & Detergents_Paper
Next we will import the ggplot2 library to do the graphical representations of data data-frame.
We’ll also add the column cluster number to the data-frame object “data”.
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library(ggplot2) data=cbind(data, Cluster=sample[,length(sample)]) data$Cluster=as.factor(data$Cluster) |
Next we will check the cluster-wise views and how the patterns differ cluster-wise.
Milk vs Grocery vs Fresh cluster wise analysis
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library(RColorBrewer) p<-ggplot(data,aes(x=Milk,y=Grocery, size=Fresh))+scale_colour_brewer(palette = "Paired") p+geom_point(aes(colour=Cluster)) <img class=" wp-image-1329 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-6-300x214.png" alt="multi variate analysis" width="513" height="366" /> |
- We notice that if expenditure on milk is high, expenditure on grocery or fresh is high, but not both
- We notice cluster 4 contains data points on the high end of milk or grocery
- Cluster 3 has got people with high spending on milk and average spending on grocery
Relationship between Milk, Grocery and Fresh across Region across Channel
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p+geom_point(aes(colour=Cluster))+facet_grid(Region~Channel) <img class=" wp-image-1330 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-7-300x214.png" alt="multi variate analysis" width="529" height="378" /> |
- Region 3 has more people than Region 1 and 2
- In Region 3 we observe an increasing trend between milk and fresh and grocery
- In Region 1 we notice that there is an increasing trend between milk and grocery but fresh is low
- In Region 2 we notice medium purchase of milk and grocery and fresh
- High milk / grocery sales and medium fresh sales is through channel 2
- In channel 2 there is an increasing trend between consumption of milk and consumption of grocery
- Cluster 4 has either high sales of milk or grocery or both
- Channel 2 contributes to high sales of milk and grocery, while low and medium sales of fresh
Milk vs Grocery vs Frozen Products Cluster wise analysis
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library(RColorBrewer) p<-ggplot(data,aes(x=Milk,y=Grocery, size=Frozen))+scale_colour_brewer(palette = "Paired") p+geom_point(aes(colour=Cluster)) <img class=" wp-image-1331 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-8-300x214.png" alt="multi variate analysis" width="520" height="371" /> |
- Very high sales of frozen products by cluster 11 and cluster 7
- People purchasing high quantities of milk and grocery are purchasing low quantities of frozen products
Relationship between Milk, Grocery and Frozen Products across Region
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p+geom_point(aes(colour=Cluster))+ facet_grid(Region~.) <img class=" wp-image-1332 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-9-300x214.png" alt="multi variate analysis" width="519" height="370" /> |
- In Region 2 and Region 3, we have clusters 1 and 3 respectively, which have high expenditure pattern on frozen products
Relationship between Milk, Grocery and Frozen across Channel
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p+geom_point(aes(colour=Cluster))+facet_grid(Channel~.) <img class=" wp-image-1333 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-10-300x214.png" alt="multi variate analysis" width="469" height="335" /> |
- We notice that channel 1 has many people with high purchase pattern of frozen products
- Channel 2 has some clusters (cluster no.: 5 and 6) with very high purchase pattern of milk
Relationship between Frozen Products, Grocery and Detergents Paper across Region across Channel
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p<-ggplot(data,aes(x=Grocery,y=Frozen, size=Detergents_Paper))+scale_colour_brewer(palette = "Paired") p+geom_point(aes(colour=Cluster))+facet_grid(Region~Channel) <img class=" wp-image-1334 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-11-300x214.png" alt="multi variate analysis" width="456" height="325" /> |
- In channel-2, people who are spending high on grocery are also spending low on frozen
- High sales of detergents paper and grocery are observed through channel 2
- Sales of frozen products is almost nil through channel 2
- Cluster 4 has high expenditure on Detergents_Paper
- Through channel 2 sales of frozen products is 0
Relationship between Milk, Delicassen and Detergents Paper across Region
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p<-ggplot(data,aes(x=Milk,y=Delicassen)) p+geom_point(aes(colour=Cluster,size=Detergents_Paper))+ facet_grid(Region~.) |
- People who spend high on milk hardly spend on Delicassen, though in region 3 we do see comparitively more expenditure on Delicassen
- Cluster 3 in region 3 has very high expenditure on delicassen and high expenditure on milk
- Cluster 4 has high consumption pattern on milk and detergents paper
Relationship between Milk, Grocery and Detergents Paper across Channel
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p<-ggplot(data,aes(x=Milk,y=Grocery)) p+geom_point(aes(colour=Cluster, size=Detergents_Paper))+ facet_grid(Channel~.) <img class=" wp-image-1335 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-12-300x214.png" alt="multi variate analysis" width="502" height="358" /> |
- Channel 2 is having an increasing trend between milk and Detergents Paper
- Where sales of detergents paper is high, the sales of milk is also high
- Channel 4 has high expense pattern on Detergents Paper or Milk
Relationship between Milk, Grocery and Detergents Paper across Region across Channel
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p+geom_point(aes(colour=Cluster,size=Detergents_Paper))+facet_grid(Region~Channel) <img class=" wp-image-1336 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-13-300x214.png" alt="multi variate analysis" width="503" height="359" /> |
- Channel 2 is having an increasing trend between milk and Detergents Paper
- Where sales of detergents paper is high, the sales of milk is also high
- Channel 4 has high expense pattern on Detergents Paper or Milk
Relationship between Milk, Grocery and Detergents Paper across Region across Channel
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<span class="identifier">p</span><span class="operator">+</span><span class="identifier">geom_point</span><span class="paren">(</span><span class="identifier">aes</span><span class="paren">(</span><span class="identifier">colour</span><span class="operator">=</span><span class="identifier">Cluster</span>,<span class="identifier">size</span><span class="operator">=</span><span class="identifier">Detergents_Paper</span><span class="paren">)</span><span class="paren">)</span><span class="operator">+</span><span class="identifier">facet_grid</span><span class="paren">(</span><span class="identifier">Region</span><span class="operator">~</span><span class="identifier">Channel</span><span class="paren">)</span> <img class=" wp-image-1337 aligncenter" src="http://dimensionless.in/wp-content/uploads/2017/03/download-14-300x214.png" alt="Channel 2 is having an increasing trend between milk and Detergents Paper Where sales of detergents paper is high, the sales of milk is also high Channel 4 has high expense pattern on Detergents Paper or Milk Relationship between Milk, Grocery and Detergents Paper across Region across Channel p+geom_point(aes(colour=Cluster,size=Detergents_Paper))+facet_grid(Region~Channel) " width="509" height="363" /> |
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- There is a linear trend between Milk and Grocery in channel 2
- There is a linear trend between Grocery and Detergent Paper
- Channel 4 has high comption of grocery and detergents paper or grocery
- Cluster 10 has medium consumption of milk, grocery and detergents paper
- Cluster 6 has low consumption of milk and grocery and detergents paper
- Cluster 2 has lowest consumption of milk grocery and detergents paper
Based on the above understanding of cluster-wise trends, we can devise cluster-wise, region-wise, channel-wise strategies to improve the sales.
V. DIMENSIONALITY REDUCTION TECHNIQUES
We use dimensionality reduction techniques like PCA to transform larger number of independent variables into a smaller set of variables:
Principal Component Analysis
Principal component analysis (PCA) tries to explain the variance-covariance structure of a set of variables through a few linear combinations of these variables. Its general objectives are: data reduction and interpretation. Principal components is often more effective in summarizing the variability in a set of variables when these variables are highly correlated.
Also, PCA is normally an intermediate step in the data analysis since the new variables created (the predictions) can be used in subsequent analysis such as multivariate regression and cluster analysis.
We will discuss PCA in my further posts.