Binary Classification with Neural

Networks: Online Retail Sales

Dataset
Dataset Overview:
The Online Retail Sales Dataset, represented by the "Online Retail.csv" file, provides
comprehensive data on e-commerce transactions. Key attributes include 'InvoiceNo',
'StockCode', 'Description', 'Quantity', 'InvoiceDate', 'UnitPrice', and 'Country'. The dataset
is rich in transaction records and customer information, making it a valuable resource
for online retail sales analysis.

Objective:
The goal is to perform binary classification (logistic regression) using neural networks on
the dataset. Specifically, we aim to predict whether the quantity of a product sold is
greater than 10 or not.

Methodology:
1. Data Preprocessing:
• The dataset is loaded and missing values are dropped.
• Features ('Quantity' and 'UnitPrice') are selected, and the target variable is
created based on the binary classification task.
2. Data Splitting:
• The dataset is split into training and testing sets using a standard 80-20
split.
3. Model Building:
• A simple logistic regression model with a single output neuron and a
sigmoid activation function is defined using PyTorch.
4. Model Training:
• The model is trained using the training set, with the binary cross-entropy
loss function and the Adam optimizer.
5. Model Evaluation:
 • The trained model is evaluated on the testing set, and metrics such as
accuracy, confusion matrix, and classification report are displayed.
6. Decision Boundary Plotting:
• The decision boundary of the model is visualized using a scatter plot, with
actual labels ('Actual') and predicted labels ('Predicted').

Results:
• The model achieves an accuracy of approximately 83.8% on the testing set.
• The confusion matrix indicates that the model correctly identifies a large number
of cases where the quantity is not greater than 10 but struggles to identify cases
where the quantity is greater than 10.
• The decision boundary plot provides a visual representation of the model's
classification.

Recommendations:
1. Model Improvement:
• Fine-tune the model architecture, hyperparameters, and training duration
for better performance.
• Consider exploring more complex neural network architectures.
2. Feature Engineering:
• Investigate additional features or transformations that could enhance
model performance.
3. Data Analysis:
• Conduct further analysis to understand factors influencing the model's
predictions.
• Explore patterns in customer behavior and regional preferences.
4. Business Insights:
• Use the model predictions to optimize inventory management and
marketing strategies.
• Leverage insights for targeted marketing and customer segmentation.

Conclusion:
The implementation of binary classification with neural networks on the Online Retail
Sales Dataset provides a foundation for understanding and predicting sales patterns.
Further refinements and explorations can unlock valuable insights for businesses in the
online retail sector.