Data Mining: What Can it do for me?
Data Mining can improve customer service, better target marketing campaigns, identify high-risk clients, and improve production processes. In short, because it can help you or your company make or save money.
Most businesses and organizations collect data about their operations. They then examine this data for insights into their operations and into the transactions their business performs.
This may be as simple as a cursory glance at a spreadsheet, to check the numbers for "sanity". Or it may involve hours of analysis using a suite of tools.
However, manual analysis typically has to stop at this point — looking for obvious simple relationships.
An automated data mining approach, however, may find profitable relationships you may not even have suspected existed, or that you knew would take too long to find by manual means. Automated data mining allows the development of models of considerable complexity which can take many more factors into account.
Data mining has been used to:
- Identify unexpected shopping patterns in supermarkets.
- Optimize website profitability by making appropriate offers to each visitor.
- Predict customer response rates in marketing campaigns.
- Defining new customer groups for marketing purposes.
- Predict customer defections: which customers are likely to switch to an alternative supplier in the near future.
- Distinguish between profitable and unprofitable customers.
- Improve yields in complex production processes by finding unexpected relationships between process parameters and defect rates.
- Identify "wedge issues" and target political campaigns.
- Identify suspicious (unusual) behavior, as part of a fraud detection process.
To sumnmarize, data mining can be applied anywhere in your business or organization where you can collect data and are interested in identifying and exploiting predictable outcomes.
