PulseExploreJournal ClubDebatesTrendingResearchersJournals
Instagram
HomeExploreJournal ClubTrending
Synapse
⌘+K
Synapse
February 2, 2026Business Management1 citations

Application of Machine Learning Algorithms in Predicting Customer Loyalty Towards Grocery Retailers

View Full Paper
JFJelena FranjkovicIFI. FosicAZAna Zivkovic

Key Points

  • The central aim is to predict customer loyalty in the grocery sector using machine learning techniques.
  • Data collected from 433 samples in Croatia
  • Model includes 10 independent predictor variables related to pricing and non-pricing characteristics
  • Used supervised machine learning classification algorithms, primarily Random Forest
  • Evaluated model performance using ROC_AUC, accuracy, and F1 score
  • Applied SHAP analysis to interpret feature impact on predictions
  • Random Forest classifier achieved a ROC_AUC value of 0.790
  • High accuracy of 0.915 and F1 score of 0.954 were noted
  • Price dynamics and service level were identified as key features influencing predictions
  • Value for money and price communication also played significant roles

Abstract

Retailers strive for customer loyalty in the sense of repeat purchases, but also as a high proportion of purchases (compared to competitors) and willingness to recommend to other customers. This paper examines customer loyalty in the grocery sector as a three-dimensional construct and shows how machine learning techniques can be useful in its study. Price characteristics of the retailer (price level, value for money, price dynamics, price communication and price dispersion) and non-price characteristics of the retailer (general product range, retailer's private label product range, store design and atmosphere, service level and location) are included in the model as predictor variables. Using the data collected through the primary research conducted in Croatia, 433 samples were divided into 10 independent predictor variables and one dependent variable (customer loyalty), a prediction was created using supervised machine learning classification algorithms. The Random Forest classifier proves to be the best choice overall, with ROCAUC value of 0. 790, a high accuracy of 0. 915 and an F1 score of 0. 954, reflecting both precision and responsiveness. The application of the SHapley Additive exPlanations analysis additionally enables the interpretation of the results, highlighting the influence of features on the accuracy of the prediction. The results indicate that price dynamics and service level are the most important features for the model predictions, followed by value for money and price communication.

Ask AI
Helpful
Bookmark
Share
View Full Paper

Cite This Study

Franjkovic et al. (2025) studied this question.

synapsesocial.com/papers/6980fc37c1c9540dea80dfd7https://doi.org/10.58861/tae.bm.2025.2.05
Ask AI
Helpful
Bookmark
Share
View Full Paper