How Data Mining Works

How Data Mining Works

How exactly is data mining able to tell you important things that you didn't know or what is going to happen next? The technique that is used to perform these feats in data mining is called modeling. Modeling is simply the act of building a model in one situation where you know the answer and then applying it to another situation that you don't. For instance, if you were looking for a sunken Spanish galleon on the high seas the first thing you might do is to research the times when Spanish treasure had been found by others in the past. You might note that these ships often tend to be found off the coast of Bermuda and that there are certain characteristics to the ocean currents, and certain routes that have likely been taken by the ship’s captains in that era. You note these similarities and build a model that includes the characteristics that are common to the locations of these sunken treasures. With these models in hand you sail off looking for treasure where your model indicates it most likely might be given a similar situation in the past. Hopefully, if you've got a good model, you find your treasure.
This act of model building is thus something that people have been doing for a long time, certainly before the advent of computers or data mining technology. What happens on computers, however, is not much different than the way people build models. Computers are loaded up with lots of information about a variety of situations where an answer is known and then the data mining software on the computer must run through that data and distill the characteristics of the data that should go into the model. Once the model is built it can then be used in similar situations where you don't know the answer. For example, say that you are the director of marketing for a telecommunications company and you'd like to acquire some new long distance phone customers. You could just randomly go out and mail coupons to the general population - just as you could randomly sail the seas looking for sunken treasure. In neither case would you achieve the results you desired and of course you have the opportunity to do much better than random - you could use your business experience stored in your database to build a model.

The goal in prospecting is to make some calculated guesses about the information in the lower right hand quadrant based on the model that we build going from Customer General Information to Customer Proprietary Information. For instance, a simple model for a telecommunications company might be:
98% of my customers who make more than $60,000/year spend more than $80/month on long distance
This model could then be applied to the prospect data to try to tell something about the proprietary information that this telecommunications company does not currently have access to. With this model in hand new customers can be selectively targeted.
Test marketing is an excellent source of data for this kind of modeling. Mining the results of a test market representing a broad but relatively small sample of prospects can provide a foundation for identifying good prospects in the overall market. Table 3 shows another common scenario for building models: predict what is going to happen in the future.

If someone told you that he had a model that could predict customer usage how would you know if he really had a good model? The first thing you might try would be to ask him to apply his model to your customer base - where you already knew the answer. With data mining, the best way to accomplish this is by setting aside some of your data in a vault to isolate it from the mining process. Once the mining is complete, the results can be tested against the data held in the vault to confirm the model’s validity. If the model works, its observations should hold for the vaulted data.

Post Purchase Consumer Behaviour

View more presentations from King Julian.

Post Purchase Consumer Behaviour / Post Purchase Dissonance / Cognitive dissonance

PROMOTION MIX / MARKETING COMMUNICATION MIX

Promotion Mix

View more presentations from King Julian.

PROMOTION MIX / MARKETING COMMUNICATION MIX

Download File for complete view of slides :)

Brand Personality - PPT

Brand Personality

View more presentations from King Julian.

Personal Selling Process

Step 1> Opening :
Example: Retail Salesperson - "...in can see that you appear to be interested in our stereo equipment. What kind of system do you have in mind?..."

Step 2> Need andProblem identification: Need analysis approach suggests that early in the sales process the salesperson should adopt a question-and-listen posture, to identify what actually the customer is looking for. salesperson should focus on questioning open ended questions rather than closed ended questions.

Step 3> Presentation andDocumentation: Benefits should be analysed at two levels: * ...the benefits which can be obtained by purchasing of a particular type of product. * ...the benefits that can be obtained by purchasing that product from a particular supplier.

NOTE: Many sales situtations involve risk to the buyer. The buyer may be reluctant to change from the present supplier or present model because doing so may lead to unforseen problems - like delievery of product may be unsatisfactory in the new model or unreliable.
There four major ways a salesperson can reduce the risk:
(a) Reference Selling
(b) Demonstration
(c) Guarantees
(d) Trial Orders

Step4> Dealing with Objections: Objections are any concerns or questions raised by the buyer, while some objectives are an exception of confusion, doubt or disagreement with the statements or information presented by the salesperson. What the buyer is asking for is further information because s/he is interested in what the salesperson is saying...!! Effective approaches for dealing with objections involve two areas: *...the preparation of convincing answers. *...the development of a range of techniques for answering objections in a manner which permits the acceptance of these answers without the loss of face on the part of buyer.

The various techiniques are as Follows:
(i) Listen and do not interrupt
(ii) Agree and Counter
(iii) Question the Objection
(iv) Trial Close
(v) Hidden Objections
(vi) The Straight Denials .......
TBConti.

BLOGGER IS BACK

It's been quite a long tym since my last post...was quite busy for soooo long...
based on the importance of this blog to my the readers..i've now decide to makeit the most happening and a bank of knowledge for the management aspirants and students....!!

Wish me luck for my "new" Start..!!

With Luv..!!
Ankur Blogger
ankur.blogger@gmail.com

Current Affairs

Colored Currents 2009

1] Whom did Rahul Gandhi refer to as "Sher-e-Punjab" and the "the pride of India" recently?
2] Who is the richest candidate to file his nomination papers in the Lok sabha elections so far?
3] How much did the Obamas pay in federal income tax for the year 2008?
4] After P. Chidambaram and Naveen Jindal, it was the turn of a which top BJP leader to face a 'flying footwear'?
5] What is the name of Hollywood actor Mel Gibsons' wife of 28 years who has recently filed for divorce?
6] Who is the present army chief of Bangladesh?
7] Who is RJD president Lalu Prasads' main rival in the Saran constituency in Bihar?
8] What is the name of the new lawyer appointed by special court to defend Mumbai terror attack accused Ajmal Qasab?
9] What is the name of new election commissioner who has succeeded N. Gopalaswami?

Keys:
i) Manmohan Singh; ii) Deepak Bhardwaj; iii) 4.2 crore; iv) L.K.Advani;
v) Robyn Denise Moore; vi) Gen. Moeen Ahmed; vii) Rajiv Pratap Rudy;
viii) Abbas Kazmi ix) Navin Chawla


Enhance UR GK - Go to "iankur GK" Label

The Thrift Brigade

From raw material to salaries, from advertising to fuel burn, a clutch of disparate companies is cutting costs to stay competitive and weather the slowdown.

These Ten Companies were among the standouts in cost control.

How...??

$ Pantaloon Retail - will save Rs 125 Cr by creating One Back-End Entity for Marketing, Hr, and IT.

$ By re-negotiating a 20-4-% cut in rentals at 50 outlets, Vishal Retail has cut its rental bills from Rs 8.5 Cr to Rs 6.5 Cr.

$ Tata Chemicals is Reviewing Every Item of costs across geographies, manufacturing, supply chains and overheads.

$ ICICI Bank cut its marketing spend from Rs 416 Cr to Rs 103 Cr by Reducing Reliance On DSAS and cutting back on promotion.

$ Its leadership established, Dish TV slashed its Above-The-Line spending by 30% and upped Below-The-Line promotion.

$ The Ashok Leyland top management has taken a voluntary salary cut, lowering wages by 20%.

$ Jet Airways plans to phase out its pool of 250 odd expat pilots, who charge 30-40% more, from its base of 1,350 pilots

$ By buying coal in the spot market, Tata Steel managed savings of $16.4 million.

$ Spice Jet pays oil companies and airport operators on-time to get discounts in return.

$ The offline-online ad mix of INFO EDGE has changed from 93:7 in 2003-04 to 29:71 in 2008-09.

General Knowledge

Some Facts & Figures of Lok Sabha Elections 2009

--------------------------------------------------------------

Number of Phases: 5

Total polling centres: 8,28,824

Total Number of voters: 71.1 crores

Total Polling Officials: 40,00,000

Details of 5 Phases:

1st Phase on April 16th in 124 constituencies

2nd Phase on April 23rd in 141 constituencies

3rd Phase on April 30th in 107 constituencies

4th Phase on May 7th in 85 constituencies

5th Phase on May 13th in 86 constituencies

Counting of the votes will be on May 16th


Enhance UR GK - Go to "iankur GK" Label