Data mining is the technique of examining a large data structure to find patterns, trends, hidden insights that would otherwise not be possible using simpler query-based techniques.
It uses sophisticated mathematical algorithms to classify, divide, segment the entire data, pre-process it as necessary and evaluate the possibility of future events.
What are the key characteristics?
1.Prediction of likely outcomes or events
2.Information about actions that can be taken
3.Automated discovery of patterns
4.Focus on large datasets and databases
Benefits of data mining
In general, the benefits of data mining come from the ability to uncover hidden patterns and relationships in data that can be used to make predictions that impact businesses.
Specific data mining benefits vary depending on the goal and the industry. Sales and marketing departments can mine customer data to improve lead conversion rates or to create one-to-one marketing campaigns. Data mining information on historical sales patterns and customer behaviors can be used to build prediction models for future sales, new products and services.
Companies in the financial industry use data mining tools to build risk models and detect fraud. The manufacturing industry uses data mining tools to improve product safety, identify quality issues, manage the supply chain and improve operations.