Abstract
As the retail industry has been challenged by stiff competition, the retailer becomes more interested in better understanding consumers' in-store behavior to gain and sustain competitive advantage. Consumers' shopping paths provide valuable clues to understanding customers' in-store behavior, which has been a long standing research issue in business. This study is to explore the shopping path patterns in a grocery using RFID technology and clustering method. To this end, we designed the RFID systems, affixing active RFID tags to the bottom of grocery carts. The tag emit signal that is received by receptors installed at various location throughout the store. The RFID systems provide the time and location of the cart while consumers shop around the store. The point of sale data are matched with the cart movement records to provide a complete picture of each shopping path. To find the distinctive patterns of consumers' shopping paths, we proposed the distance-index matrix using dijkstra method and normalization method to conduct the clustering in order to handle the problem in measuring the similarity among shopping paths, which is raised by the spatial nature of consumer movement in a grocery. After analyzing the RFID data obtained in one of the groceries in a major Korean retailer, we could successfully identify several distinctive patterns of shopping paths, which prove to provide the valuable implications for store management.