Data mining

Introduction

Data mining is a newly developed computer-assisted process of gathering and analyzing various sets of data, and then revealing the meaning of that data. This knowledge discovery anticipates behaviors and future trends, enabling businesses to adopt and implement proactive and knowledge-driven decisions. Through this technology, companies are capable of getting answers to their questions, which initially were taking much time to resolve (Gupta, 2011). This paper pays high attention to the various ways in which this technology helps companies to generate more business.

Data mining enables an organization to identify the customers who purchase same products from it (market segmentation). This makes the company increase the quality and quantity of these products, so that when these customers come for them, they would always find them. This, in the long run, helps the company to maintain and enhance customer`s loyalty (Gupta, 2011). In addition, this technology helps a company to contemplate the products or services that are mostly purchased together (market basket analysis). For example, cell phones and memory cards. This would make the particular company increase the production of the two products if initially had concentrated on producing more cell phones and fewer memory cards.

Consecutively, data mining would help a company to anticipate the customers who are likely to shift to its competitors (customer churn). This would enable the company`s management to develop and implement strategies for winning back those customers, rather than waiting for them to divert to the other companies that are producing the same products or services. Moreover, the technology would help a company to predict the products that should appear on its website, so that customers visiting this website can see the varieties that the company offers. This would result in increased sales (Gupta, 2011).

Conclusion

It is, therefore, evident that data mining can facilitate the operations of a given company, enabling it to expand beyond its boundaries. Organizations should incorporate this new technology, in order to facilitate their survival and success.

References

Gupta, G. K. (2011). Introduction to data mining with case studies. S.l.: Prentice-Hall Of India Pv.