Magazine article CRM Magazine

Integrated Data Mining-The Core to Customer Analytics Success

Magazine article CRM Magazine

Integrated Data Mining-The Core to Customer Analytics Success

Article excerpt

Companies like yours seek to use data mining to group customers into benefits-based segments, to find those most likely to respond to cross-sell and acquisition offers, to improve retention, and to personalize communications in real time. Data mining can make the mountains of data that companies collect useful and immediately actionable, whether that data comes from:

* Transactional systems

* Contact centers

* The Internet

* Digital marketplaces

* Third-party sources

* Social media

Unfortunately, in many firms data mining has not lived up to the hype and potential. Traditional tools require organizations to go through the complex task of building a data-mining-focused data mart, requiring months of work to locate the relevant sources of data, clean the data, and build the data into an appropriate schema. As well, traditional tools can be expensive, complex, and hard to use, and generally require an advanced understanding of statistics.

LOOK FOR AN EASY-TO-USE SYSTEM

The biggest barrier preventing widespread use of data mining is the complexity of traditional tools. Data mining will never achieve enterprise-wide use as long as tools have a steep learning curve and require a degree in statistics to run and analyze. Look for robust functionality with a beautiful and intuitive user interface that encourages you to ask questions and dig for answers without risk or resource mismanagement.

GET A SINGLE VIEW OF THE CUSTOMER

Clearly, data mining requires data--the more the better. But to get "nuggets" of knowledge, you need to have significant amounts of "ore." Like many organizations, yours may have data scattered across systems and databases, and rarely have it in the correct format for data mining algorithms. Before data mining can begin, you must build a warehouse of clean, consistently encoded information--a significant task that can take months or even years. The process of preparing data for analysis can often take up to 95% of the total time required for data mining.

ASSUME EXPONENTIAL DATA GROWTH AND EVER-CHANGING DATA SOURCES

Data tends to be locked down, so adding new sources of data (think social and mobile) is discouraged, even when that data can be most emotive and directionally valuable. …

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