Identifying groups/networks of customers

I am trying to create unique customer groups which are determined by customer interactivity across transactions.

Here is an example of the data:

In this example, customer 1 is connected to customers 2-6 either directly or indirectly, so all transactions associated with customers 1-6 would be a part of an "A" group. Customer 7 and 8 are directly connected and would be labeled as a "B" group. Customer 9 has no connections and are the single member of the "C" group.

Any suggestions are appreciated!

Your data can be considered the edges of a graph. So your request is to find the connected subgraphs of that graph. That question has an answer on Stackoverflow and SAS Communities. But this question is more on topic than that older SO question. So let's post the subnet SAS macro from the SAS Communities answer here on SO where it will be easier to find.

This simple macro uses repeated PROC SQL queries to build the list of connected subgraphs until all of the original records have been assigned to a subgraph.

The macro is setup to let you pass in the name of the source dataset and the names of the two variables that hold the ids of the nodes.

So first let's convert your printout into an actual SAS dataset.

data have;
  input id primary cosign want $;
cards;
1 1 2 A
2 1 3 A
3 1 4 A
4 1 2 A
5 2 5 A
6 3 6 A
7 2 1 A
8 3 1 A
9 7 8 B
10 9 . C
;

Now we can call the macro and tell it that PRIMARY and COSIGN are the variables with the node ids and that SUBNET is the name for the new variable to hold the ids of the connected subgraphs. NOTE: This version treats the graph as directed by default.

%subnet(in=have,out=want,from=primary,to=cosign,subnet=subnet);

Results:

Obs    id    primary    cosign    want    subnet

  1     1       1          2        A        1
  2     2       1          3        A        1
  3     3       1          4        A        1
  4     4       1          2        A        1
  5     5       2          5        A        1
  6     6       3          6        A        1
  7     7       2          1        A        1
  8     8       3          1        A        1
  9     9       7          8        B        2
 10    10       9          .        C        3

Here is the code of the %SUBNET() macro.

%macro subnet(in=,out=,from=from,to=to,subnet=subnet,directed=1);
/*----------------------------------------------------------------------
SUBNET - Build connected subnets from pairs of nodes.
Input Table :FROM TO pairs of rows
Output Table:input data with &subnet added
Work Tables:
  NODES - List of all nodes in input.
  NEW - List of new nodes to assign to current subnet.

Algorithm:
Pick next unassigned node and grow the subnet by adding all connected
nodes. Repeat until all unassigned nodes are put into a subnet.

To treat the graph as undirected set the DIRECTED parameter to 0.
----------------------------------------------------------------------*/
%local subnetid next getnext ;
%*----------------------------------------------------------------------
Put code to get next unassigned node into a macro variable. This query 
is used in two places in the program.
-----------------------------------------------------------------------;
%let getnext= select node into :next from nodes where subnet=.;
%*----------------------------------------------------------------------
Initialize subnet id counter.
-----------------------------------------------------------------------;
%let subnetid=0;
proc sql noprint;
*----------------------------------------------------------------------;
* Get list of all nodes ;
*----------------------------------------------------------------------;
  create table nodes as
    select . as subnet, &from as node from &in where &from is not null
    union
    select . as subnet, &to as node from &in where &to is not null
  ;
*----------------------------------------------------------------------;
* Get next unassigned node ;
*----------------------------------------------------------------------;
  &getnext;
%do %while (&sqlobs) ;
*----------------------------------------------------------------------;
* Set subnet to next id ;
*----------------------------------------------------------------------;
  %let subnetid=%eval(&subnetid+1);
  update nodes set subnet=&subnetid where node=&next;
  %do %while (&sqlobs) ;
*----------------------------------------------------------------------;
* Get list of connected nodes for this subnet ;
*----------------------------------------------------------------------;
    create table new as
      select distinct a.&to as node
        from &in a, nodes b, nodes c
        where a.&from= b.node
          and a.&to= c.node
          and b.subnet = &subnetid
          and c.subnet = .
    ;
%if "&directed" ne "1" %then %do;
    insert into new 
      select distinct a.&from as node
        from &in a, nodes b, nodes c
        where a.&to= b.node
          and a.&from= c.node
          and b.subnet = &subnetid
          and c.subnet = .
    ;
%end;
*----------------------------------------------------------------------;
* Update subnet for these nodes ;
*----------------------------------------------------------------------;
    update nodes set subnet=&subnetid
      where node in (select node from new )
    ;
  %end;
*----------------------------------------------------------------------;
* Get next unassigned node ;
*----------------------------------------------------------------------;
  &getnext;
%end;
*----------------------------------------------------------------------;
* Create output dataset by adding subnet number. ;
*----------------------------------------------------------------------;
  create table &out as
    select distinct a.*,b.subnet as &subnet
      from &in a , nodes b
      where a.&from = b.node
  ;
quit;
%mend subnet ;