What is Data Mining

DATA MINING


Data mining refer to computer-assisted tools and techniques for shifting through and analysing these vast data stores in order to find trends, patterns and correlations that can guide decision making and increase understanding. It is also known as knowledge discovery. It covers a variety of uses from analysing customer purchases to discovering galaxies.


Data mining process include many steps. Firstly it collects data and loads it into their data warehouses. Then they store and manage the data in house server or the cloud. Business analysts, management teams and information technology professionals access the data and determine how they want to organize it. Then application software sorts the data based on the user’s result and finally end user presents the data in an easy-to- share format, such as a graph or table.



Applications of data mining:

By recording the activity of shoppers in an online store, such as Amazon.com, over time, retailers can use knowledge of these patterns to improve the placement of items in the layout of a mail-order catalo page or web page.
Telephone companies mine customer billing data to identify customers who spend considerably more than average on their monthly phone bill. The company can then target these customers to sell additional services.
Marketers can effectively target the wants and needs to specific consumer groups by analysing data about customer preferences and buying patterns.
Hospitals use data mining to identify groups of people whose healthcare costs are likely to increase in the near future so that preventative steps can be taken.


ADVANTAGES of Data mining:

It helps in market analysis. Retail companies offer certain discounts for particular products that will attract more customers.
It helps in market companies build models on historical data to predict who will respond to new market.
It gives information about loan and credit reporting I financial institutions.
In bank it helps to detect fraudulent credit card transactions to protect credit card owner.
It helps in government agency by digging and analysing records of the financial transaction to build patterns that can detect money laundering or criminal activities.


Disadvantages of data mining:

Privacy issues
Security issues
Missus of information
Inaccurate information