Application of Decision-Tree Induction Techniques to Personalized Advertisements on Internet Storefronts

Jong Woo Kim, Byung Hun Lee, Michael J. Shaw, Hsin-Lu Chang, and Matthew Nelson
International Journal of Electronic Commerce,
Volume 5, Number 3, Spring 2001, pp. 45.

Abstract: Customization and personalization services are a critical success factor for Internet stores and Web service providers. This paper studies personalized recommendation techniques that suggest products or services to the customers of Internet storefronts based on their demographics or past purchasing behavior. The underlining theories of recommendation techniques are statistics, data mining, artificial intelligence, and rule-based matching. In the rule-based approach to personalized recommendation, marketing rules for personalization are usually obtained from marketing experts and used to perform inferencing based on customer data. However, it is difficult to extract marketing rules from marketing experts, and to validate and maintain the constructed knowledge base. This paper proposes a marketing rule-extraction technique for personalized recommendation on Internet storefronts using machine learning techniques, and especially decision-tree induction techniques. Using tree induction techniques, data-mining tools can generate marketing rules that match customer demographics to product categories. The extracted rules provide personalized advertisement selection when a customer visits an Internet store. An experiment is performed to evaluate the effectiveness of the proposed approach with preference scoring and random selection.

Key Words and Phrases: Decision-tree induction, Internet advertising, Internet storefront, machine learning, personalization.