There is huge amount of data available in Information Industry. This data is of no use until converted into useful information. Analysing this huge amount of data and extracting useful information from it is necessary.
The extraction of information is not the only process we need to perform, it also involves other processes such as Data Cleaning, Data Integration, Data Transformation, Data Mining, Pattern Evaluation and Data Presentation. Once all these processes are over, we are now position to use this information in many applications such as Fraud Detection, Market Analysis, Production Control, Science Exploration etc.
What is Data Mining
Data Mining is defined as extracting the information from the huge set of data. In other words we can say that data mining is mining the knowledge from data. This information can be used for any of the following applications:
- Market Analysis
- Fraud Detection
- Customer Retention
- Production Control
- Science Exploration
Need of Data Mining
Here are the reasons listed below:
- In field of Information technology we have huge amount of data available that need to be turned into useful information.
- This information further can be used for various applications such as market analysis, fraud detection, customer retention, production control, science exploration etc.
Data Mining Applications
Here is the list of applications of Data Mining:
- Market Analysis and Management
- Corporate Analysis & Risk Management
- Fraud Detection
- Other Applications
Market Analysis and Management
Following are the various fields of market where data mining is used:
- Customer Profiling – Data Mining helps to determine what kind of people buy what kind of products.
- Identifying Customer Requirements– Data Mining helps in identifying the best products for different customers. It uses prediction to find the factors that may attract new customers.
- Cross Market Analysis – Data Mining performs Association/correlations between product sales.
- Target Marketing – Data Mining helps to find clusters of model customers who share the same characteristics such as interest, spending habits, income etc.
- Determining Customer purchasing pattern – Data mining helps in determining customer purchasing pattern.
- Providing Summary Information – Data Mining provide us various multidimensional summary reports
Corporate Analysis & Risk Management
Following are the various fields of Corporate Sector where data mining is used:
- Finance Planning and Asset Evaluation – It involves cash flow analysis and prediction, contingent claim analysis to evaluate assets.
- Resource Planning – Resource Planning It involves summarizing and comparing the resources and spending.
- Competition – It involves monitoring competitors and market directions.
Data Mining is also used in fields of credit card services and telecommunication to detect fraud. In fraud telephone call it helps to find destination of call, duration of call, time of day or week. It also analyse the patterns that deviate from an expected norms.
Data Mining also used in other fields such as sports, astrology and Internet Web Surf-Aid.