Data Mining: Customer Data Knocking at Your Door

Merchants are missing a large amount of valuable data because they aren't converting it into useful information that can be leveraged to increase sales. The use of data mining will enable marketers to face the challenge of extracting useful information that is valuable for business from that which is less useful. The second generation of data mining solutions tailor to individual market needs and are built by experienced providers. Data mining has become very popular in the e-marketplace because of the rapid growth of the Internet and e-business, which leads to increased online transaction processing and the expansion of large databases. All of this contributes to the "data explosion" and there is a widespread need for data management solutions.

"In terms of e-commerce, there is valuable data many merchants don't convert to useful information, and that can have a profound impact on sales. Data points that often go unchecked include: items visited but not purchased, abandoning shopping carts because the shipping cost is too high or abandoning the cart because the user interface is clunky."

For example, by analyzing these data points that are often unchecked one client was able to get a 40% increase in sales by lowering shipping costs by $.50, which was the critical breaking point in consumer's minds. Another commonly overlooked area in data mining is historical information pertaining to fraudulent transactions. When data mining is combined with the already implemented Internet security system an additional layer of security is achieved. Pairing these two security elements can greatly increase security by selecting various parameters several times a day and looking for unusual patterns.

The use of data mining will become more significant in regards to e-marketing as time progresses. Most business information is simply not made available to the right people in a context that makes sense. New business intelligence systems will utilize web portals and data mining to offer a degree of summarization that is more easily understood by key decision makers. In this age of information, the businesses who most effectively convert raw data into useful information to improve day-to-day processes will gain an incredible competitive advantage.