Vast amounts of customer-, market- and business critical data are stored on servers of companies. Data mining is the solution to gain the highest values out of this information available. Data mining means the scanning and analysing of data to determine its value for the business. This could be around production, or sales and marketing information that can be utilized to the companies’ advantage in many different ways.
They help for example with:
- Defining customer profiles
- Market segmentation
- Market predictions
- Product placement
- Network analysis
- Optimisation of prices
But how can this information benefit my business process? Basically it can contribute to helping you with your decision making processes and providing insight. Among other benefits data mining can help you better understand your target group, to analyse their purchasing behaviour and to identify patterns. This way marketing can be adapted and become more focused. For example, by analysing your data you can ascertain which products are most likely to be purchased together as a bundle. With this knowledge you can make sure that these products are placed closer together. Besides, you can also filter out which factors are impact customer loyalty, what clients are looking for, and their reaction to it. In summary, data mining helps with understanding and identifying patterns and expectations and to adjust accordingly.
The advantages of data mining for businesses are various. It helps, for example with personalizing your marketing to clients. By understanding your customers behaviours you will be better able to address them.. The early on identification of trends helps you stay competitive and information about behaviour patterns will continue to help you with your daily and future decision making.
Data mining is becoming increasingly important with the Internet, which means it will take on a larger and larger role going forward in a company’s success.