Unveiling the Significance of Individual Level Predictions: A Comparative Analysis of GRU and LSTM Models for Enhanced Digital Behavior Prediction

The widespread use of technology has led to a transformation of human behaviors and habits into the digital space; and generating extensive data plays a crucial role when coupled with forecasting techniques in guiding marketing decision-makers and shaping strategic choices. Traditional methods like autoregressive moving average (ARMA) can-not be used at predicting individual behaviors because we can-not create models for each individual and buy till you die (BTYD) models have limitations in capturing the trends accurately. Recognizing the paramount importance of individual-level predictions, this study proposes a deep learning framework, specifically uses gated recurrent unit (GRU), for enhanced behavior analysis. This article discusses the performance of GRU and long short-term memory (LSTM) models in this framework for forecasting future individual behaviors and presenting a comparative analysis against benchmark BTYD models. GRU and LSTM yielded the best results in capturing the trends, with GRU demonstrating a slightly superior performance compared to LSTM. However, there is still significant room for improvement at the individual level. The findings not only demonstrate the performance of GRU and LSTM models but also provide valuable insights into the potential of new techniques or approaches for understanding and predicting individual behaviors.