For centuries, people have mined core minerals indispensable to our way of life. From extracting coal to produce construction and manufacturing materials, to obtaining gold to make lifesaving medical equipment and technological components for computers and space shuttles (not just fancy jewelry), mining allows society to create, and evolve.
Data mining is no different for businesses.
The Economic Times defines data mining as “a process used to extract usable data from a larger set of any raw data.” In other words, from a small business IT perspective, data mining is all about collecting data, storing it, and extracting the important parts to gain insight into anything you can imagine – from your customers and their buying habits, to your current business functions and how you’re progressing as part of your long-term strategy. Data mining can be a major competitive advantage for business’ who see and understand its value and potential.
While data mining isn’t necessarily a new term, if you don’t work in IT, the concept can be confusing.
Effective data mining is all about finding the right data and extracting it. Consider the high volumes of information that is constantly flowing to and from a variety of sources – websites, social media, mobile phones, interactive software and numerous other digital channels. The amount of data is endless, and not all of it may be applicable to your business. Within the infinite amounts of data are nuggets of pure business gold. For business, data mining is about digging through the dirt, finding the ‘diamond in the rough’; the useful chunks of information, and applying it to make sound data-driven business decisions.
So, how do businesses ‘do’ data mining?
Surprisingly, its not some IT guru working night and day browsing through endless amounts of code trying to find a needle in a haystack. As glamorous as that position sounds, it’s not the reality (although if it is your reality, check out our careers page and see if we have an opening). While technology has changed and improved the way we work, it has had an affect on data mining. No longer is data mining just for the ‘big guys’ with big budgets.
Business of all sizes are starting to see value in data mining. The analysis of these data sets are proven to provide valuable insight. There are a million ways to gather the data. The Federation of Independent Businesses (NFIB), advises that when starting, businesses should focus their data mining efforts in two main areas – operations and marketing:
Identify the questions you want to answer regarding your customers’ behavior.
Do an audit of your current data situation.
Evaluate your skills internally – do you need to hire a consultant?
Do a quick data analytics pilot.
Measure efficiency over time (operations and marketing).
Identify patterns and trends. Make recommendations based on those.
Still curious about the benefits that data mining can offer your small business IT strategy (you know, other than giving you a better understanding your customers, your business, and your goals)? If you have questions or want advice on where to begin, reach out.
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