Data Mining: Turning Customer Data into Customer Knowledge

by Billy Bennett on February 3, 2017 in Business Intelligence, E-Commerce Solutions, IT Education, News, Services & Outsourcing, Technology, Uncategorized


We’ve all heard the term used in the modern industry, Data Mining. What does it mean though? Essentially, data mining is the process of collecting large amounts of data and analyzing it to create a meaningful set of patterns, trends, and rules. With today’s technology, there is an unlimited amount of data being sent back and forth between our “smart” devices and databases all over the world. This data contains our likes and dislikes from social media. It contains our purchasing history from e-commerce sites such as; Amazon, eBay, and really any other online retailer. It also contains our marital status, demographic information, race, gender, and pretty much anything else we put out there.
Why it’s Trending:
There are several factors that play into the increasing use of data mining.
1. We all know that data is the blood stream of any modern organization, and data is literally everywhere now. It’s being produced by almost everything we do,
2. and it’s being warehoused.
3. The heartbeat of the modern organization is their computing power, which is becoming increasingly more affordable as technology advances.
4. Our interest in CRM is growing.
5. Supporting software and products are available.

The Data we Produce

This has become an invaluable source of information for marketing teams in collecting what they need to target key markets with certain advertisements and products that match their likes, needs, and activities. By collecting this data and analyzing it (based on any number of variables or factors), your customer data becomes their customer knowledge. Organizations can use this knowledge to create predictive trends in their products, seasonal buying patterns of certain areas or demographics, and even create predictive financial analysis, customer relationship management (CRM), and campaign management.

It’s Being Warehoused

Data warehousing has become a key factor in data mining. This is where the raw data from your organization’s business processes is extracted and fed into a memory source. Many organizations with several locations have what are called “data marts” that store raw data that meets specific criteria that is targeted to that location or department’s need. The warehouse collects data from many areas with a constant format and key/field characterizations so that it can be accurately processed.

Affordable Computing

Since the algorithms used in data mining can entail several passes over vast capacities of data, they can be computationally rigorous. As technology advances and becomes more compact and less expensive to produce, the price of memory space, processing power, and network bandwidth. This has rendered once-expensive techniques financially reasonable modern organizations to perform.

CRM is Growing

More and more organizations are realizing that a healthy CRM is extremely beneficial to the organization’s growth and competitiveness in the modern market. With the growth of data mining, customer data is becoming a key asset to an organization because information is now being increasingly recognized as a product. The customer knowledge that a company gathers can be sold to other companies. (For instance; a credit card firm can charge a commercial airline to push their frequent flyer package to a customer whom regularly travels with another commercial airline.)

Supporting Software Availability

As with any new process, there are “best practices” and widely used techniques that can be used that aren’t proprietary to one business or another. This is no different with data mining. With the increased use of data mining, new commercial and open-source software is available to organizations embarking on this journey.

These include:
1. Orange – Python based – free (open-source)
2. Weka – SQL/Java – free (open-source)
3. Rattle GUI – Java – Free (open-source)
4. Grow BI Dashboard – Not Free
5. Dundas BI – Not Free
6. And many, many more…


Having a competitive advantage requires a constant effort in today’s market. It’s always been the general idea that, “The customer is always right.” As we collect these vast quantities of data, we’re able to market customers with products and services that cater to their proprietary life style and their preferences. Data mining gives your organization an opportunity to grow your customer relationships and also more efficiently predict future situations, allowing you to more efficiently manage your business processes.