The amount of data being collected every year is growing faster than ever with every human on the planet producing 102 megabytes of information every minute. In any organization, business intelligence can productively help the decision makers in making strategic decisions by analyzing the data generated within the company and its users.
Data mining is the process that supports business intelligence to gather insights on what is and isn’t working in their organizations and forecasts future trends to improve overall business operations like production, sales, cost-cutting, or market research.
Looking for gold in a mine of information. Data Mining can help. Like how mining for gold is digging through Earth and rock for the valuable bits, data mining is sorting through large datasets to find valuable information.
Since this data is often raw and unstructured this makes it is challenging for its users to draw any meaningful conclusions. Data mining decodes these complex data sets and delivers a cleaner version of them to the business intelligence team who derive insights in addition to providing insights on internal operations. This data can be transformed into a visualization such as a dashboard that displays results using graphs, charts, and KPIs helping decision-makers point out the major trends and important anomalies that wouldn’t otherwise be apparent.
Harnessing the power of data mining and business intelligence, businesses can use hyper-personalized advertising to reach their target audience. To understand how data mining is used in improving business we need to explore the relationship between business intelligence and data mining.
Data Mining And Business Intelligence – How They Work Together To Improve A Business
A century ago oil was the most sought-after commodity but in today’s world, it looks like data has become the new oil. Wondering why? Data Mining Techniques to improve business intelligence in areas like marketing, risk management, fraud detection, cybersecurity, medical diagnosis, and mathematics and research disciplines like cybernetics and genetics.
From hyper-personalized advertising to corporate dropshipping to political intelligence the power of data mining is beyond any arsenal and is mighty enough to build or break opinions, perceptions, and choices.
With the amount of insight and knowledge that can be extracted, utilized, and shared, data mining and business intelligence is now arguably the most valuable asset for any organization.
Data mining helps in increasing productivity in business operations, but it can also set a business apart from the competition in combination with predictive analytics, machine learning, and other aspects of advanced analytics. The process of data mining combined with business intelligence algorithms implements statistical methods to identify behaviors in data to help assess business queries and predict future trends and customer behavior.
The ultimate goal of coupling data mining with business intelligence is to turn data into meaningful business insights that can help a business grow. In the case of business intelligence, data Mining focuses on finding relevant information and data sets, which can then be used for analytics and predictive modeling.
For instance, a credit card company can analyze data about its customers to determine who might subscribe to a credit card offer which would allow the company to spend more time and energy on targeting those potential customers who can actually buy the upcoming offers from the company.
In general, data mining helps a business to unveil the complex patterns and behaviors that can affect its operations and sales. For example, by using data mining, companies can improve their business intelligence to maximize sales, improve marketing by identifying the right audience, build risk-averse business models to avoid frauds, sort finances and improve safety in the operations, address quality issues, and manage production or supply chain operations.
If you’re just manually entering sales figures into an excel spreadsheet then you’re already working with data and as long as it’s correctly structured you can simply plug it into a business intelligence tool that helps you turn it into easy-to-digest charts and graphs There are business intelligence tools on the market today that cost very little or and some of them are totally free to use.
Business intelligence is all about harnessing the power of data mining, that data your business generates in all of its different activities. We use this data to further assess and make a visual presentation to make an understandable form of it and to gather some powerful insights into your company’s performance. The insights gathered from this data interpretation help you in expanding your business by letting you make better and smarter decisions.
The insights gained from data mining help a company to make smarter business decisions and to help by either increasing your revenue by improving performance or reducing costs by spotting areas where money might be saved.
The final outcome of any data interpretation, assessment, and evaluation presents an understandable form of the data you have gathered, that too in a visual medium. Whereas a car dashboard displays things like your speed, how much is left in the tank, or the outside temperature a business intelligence dashboard contains your business’ metrics or KPIs like your revenues, stock levels, or how much engagement you’re getting from consumers on different platforms.
Visualizing your data makes it easy to read, understand and digest and makes it much easier to read and understand to spot trends and see where things are going well. Also, the visual form of data helps in understanding the multiple aspects of your business that need improvement.
Once we’ve got all the data together, analyzed, and visualized it, it’s time for the insight stage where we read the results of the analysis and see what we can learn. Data mining helps you gain insights from your data to make smarter business decisions. The graphs displayed in your dashboard aren’t mere photos or fancy charts, they are powerful enough to provide you with a deep understanding of how your company is functioning. Because this data is conceptualized and summarized in a visual form, it is considered to be easier to understand, and faster to read.
Some powerful examples of how data mining miraculously helps in utilizing business intelligence
Time has passed, this is not an era when all the data was presented in the form of spreadsheets or databases. In the age of the internet, we have our businesses empowered with multiple social media networks, powerful applications, software based business solutions, and cloud-based business services – and all these services gather a mountain of data and numbers. Roughly 300000 Instagram stories, 1.4 million tinder swipes, or 4.5 million youtube videos are uploaded every minute but with all this data being generated, what are companies doing with it?
In 2019 google earned 134.8 billion dollars from advertising making advertising a key component in any business’s arsenal. With the rate at which the internet population is growing, a huge amount of data is now available that can reflect consumers’ inclinations toward the latest trends.
This data collected from the users helps tech companies like Google, Facebook, Microsoft, and others to serve online advertisements as an opportune avenue to monetize their services and succor advertisers to reach their target audience efficiently with hyper personalized advertising campaigns.
For instance, Facebook ad manager and google AdSense are the two most utilized digital marketing platforms due to their comprehensive data collected on each individual user and the scale of users. Data mined from these platforms can be used by e-commerce companies and even political campaigns to deliver hyper personalized advertising to a target audience in order to sell their products or deliver key messages.
Not just for businesses, these personalized advertisements can also benefit customers in finding what they actually need as these campaigns personalize the ads according to their demographics, interests, online behaviors, and backgrounds. Recent research shows that 71 percent of respondents prefer personalized advertisements to avoid irrelevant advertisements, discover new products and make online shopping easier.
Now let’s take a look at how it’s changing industries and business models. Drop shipping is another good example of how data mining has transformed business intelligence. Many e-commerce platforms and online retailers have adopted drop shipping as their primary business model making it easy for anyone to start a business. Drop shipping uses business intelligence platforms like Facebook Ads Manager and Google Ads that harness the power of data mining to connect these businesses to their ideal consumers from anywhere in the world.
Under the umbrella of business intelligence, we find the concept of predictive analytics which uses data mining tools, statistical algorithms, and machine learning techniques to identify the likelihood of future outcomes based on historical data gathered from the masses.
Cambridge Analytica, a self-proclaimed global election management agency sparked a huge controversy in 2016’s US presidential election by targeting and spreading political ideologies to very particular demographics. Agencies like Cambridge Analytica use machine learning algorithms, predictive analytics, and data mining to build a psychological profile of each voter.
The agency had 5000 data points on every American voter which they used to identify persuadable populations who were susceptible to being influenced in their voting decision. Exploiting the power of data mining, Cambridge Analytica helped its clients to sway voters by serving hyper personalized electoral campaigns.
So the next time you see a targeted ad on your social media don’t wonder how it knows your preferences but how it can be used to manipulate your decisions.