Merchant Service Recommendation System Using Transaction Scores

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Solution Overview

Problem

Small businesses often struggle to survive due to competition from large national or international chains, lacking access to technology and services that could help them reduce overhead, increase profits, and differentiate themselves, such as information technology, inventory, and management services.

Innovation Solution

A system and method for identifying business service recommendations for targeted merchants using a merchant database that stores transaction data and firmographics, calculating transaction scores, and matching similar merchants to provide tailored service suggestions based on these scores and firmographics.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Ease of manufacture

If small businesses use traditional manual methods to identify services, then they can avoid complex technology infrastructure, but they cannot access tailored service recommendations that could reduce overhead and increase profits

Engineering Contradiction:

Improveease of service identificationVSAvoidaccess to tailored service recommendations

Core Design Contradiction:

Ease of manufactureVSLoss of information

Solution Approach 1:

The system enables automatic self-service by using machine learning models to autonomously analyze merchant transaction data and firmographics, generating personalized service recommendations without requiring merchant intervention or complex manual analysis processes

Inventive Principle:

Principle #25Self-service

Solution Approach 2:

The patent replaces manual information processing and service identification methods with automated computational systems that use transaction data analysis and machine learning algorithms to generate service recommendations, substituting mechanical human analysis with electronic data processing

Inventive Principle:

Principle #28Mechanics substitution (Replace mechanical system)

2Loss of information

If small businesses implement comprehensive service analysis systems, then they can access tailored recommendations, but they would require complex technology infrastructure that they currently lack

Engineering Contradiction:

Improveaccess to service recommendationsVSAvoidtechnology infrastructure

Core Design Contradiction:

Loss of informationVSDevice complexity

Solution Approach 1:

The system introduces an intermediary processing layer that receives existing transaction data from merchants through standard payment processing channels and transforms it into actionable service recommendations, avoiding the need for merchants to implement complex data collection or analysis infrastructure

Inventive Principle:

Principle #24Intermediary (Mediator)

Solution Approach 2:

The system uses multi-functional processing that analyzes multiple data types (transaction data, firmographics, business attributes) through a unified machine learning framework, allowing a single system to perform diverse analysis functions without requiring separate specialized infrastructure for each function

Inventive Principle:

Principle #6Universality (Multi-functionality)

3Adaptability or versatility

If small businesses compete with large national chains, then they can serve local communities, but they cannot match the lower profit margins and pricing power of large businesses

Engineering Contradiction:

Improvelocal community serviceVSAvoidprofit margins

Core Design Contradiction:

Adaptability or versatilityVSLoss of energy

Solution Approach 1:

The system applies local quality by generating customized service recommendations specific to each merchant's local market context, business size, and transaction patterns, allowing small businesses to identify services that address their unique local competitive conditions rather than applying generic solutions

Inventive Principle:

Principle #3Local quality

Solution Approach 2:

The system enables parameter changes by identifying services that can alter key business parameters such as overhead costs, operational efficiency, and profit margins, allowing small businesses to improve their financial parameters through targeted service adoption rather than direct price competition

Inventive Principle:

Principle #35Parameter changes

4Device complexity

If small businesses lack technology access, then they can maintain simpler operations, but they cannot identify internal services that could decrease overhead and increase production

Engineering Contradiction:

Improvetechnology accessVSAvoidoverhead reduction and production increase

Core Design Contradiction:

Device complexityVSProductivity

Solution Approach 1:

The system implements feedback by continuously analyzing merchant transaction data and service adoption outcomes, using machine learning models to learn from patterns in the data and generate increasingly accurate service recommendations that reflect actual business performance and needs

Inventive Principle:

Principle #23Feedback

Solution Approach 2:

Inventive Principle:

Principle #25Self-service

Data Source

PatentUS9542688B2Method and system for targeting small businesses

Publication Date: 2017.01.10 MASTERCARD INT INC

AI summary

A method for identifying business service recommendations includes: storing merchant profiles, each profile including data related to a merchant including a merchant identifier and transaction for a plurality of payment transactions; receiving, a data file including a plurality of merchant entries, each entry including data related to a merchant including a merchant identifier and firmographics; identifying a specific merchant entry where the merchant identifier corresponds to a merchant identifier in a specific merchant profile; calculating transaction scores for the specific merchant entry based on the transaction data in the specific merchant profile; identifying a related merchant entry where the firmographics correspond to the firmographics in the specific merchant entry and where the merchant identifier is not included in a merchant profile; and identifying one or more business service recommendations for the merchant related to the related merchant entry based on transaction scores and firmographics in the related merchant entry.