Whether your business is a small business selling homemade crafts or a huge corporation selling technology that is worth millions of dollars, the business will need to do some data mining in order to fully understand its customers. Data mining can be used in all sorts of fields, from understanding why your customers buy what they do, to helping you create products that appeal to your niche, to even improving the cybersecurity of your business.
But what is data mining and how do you use it to the best advantage of your business? By the end of this article, you should have a much greater understanding of how to use the data your business collects to enhance your business.
Why and how do businesses collect data?
All businesses collect and contextualize data, even if they don’t plan too, because every interaction that your business has with a customer is all about data. Whether you have an email list and a poll on your website, or an entire marketing team dedicated to learning about what makes your customers tick, your business is using data to understand your customers and predict what they will do next.
Most data that is collected concerns a customer’s behavior. This can include how they engage with a website or an application. If your customers spend two minutes on the homepage of your website, you can use that data to figure out if they will become paying customers. Other behavioral data includes purchase histories and data on repeated actions, allowing you to predict what your customers will do next.
Often this data is collected and stored through cookies, tracking technologies and looking at how customers behave on your website or on your social media.
How is all the data used?
If a business has all the data from their customer interactions on their website, then they need to look through the data to determine patterns, which is often done using a computer program and a process called data mining. Data mining has a few steps, such as:
- Defining the goal of the data collection.
- Cleansing the data to validate it.
- Building a model and choosing the right technique.
- Validating the results.
Let’s break down each step one by one.
Any business will need to figure out what the goal of its data collection is. Do you want to figure out how to market to certain types of customers? Do you want to see what makes a data campaign effective? Do you want to analyze your website to see what pages customers stay the longest on? All these different goals require different sets of data to use, so gathering the correct data is the best course of action.
The data then needs to be cleansed and validated, and once that is done the data can be interrogated. This process often includes statistical analysis, incorporating the data visually through charts and graphs and inspecting the data for patterns that support the goal of the data collection.
Afterwards, the data is organized, and depending on the goal, it is analyzed through one of several types of models. For example, one type of data mining model, called a descriptive model, focuses on telling a story based on the data, whether that is looking for patterns or outliers. These models look for what is similar about the data in order to understand why customers have been doing what they have been doing.
The predictive modeling of data mining goes deeper than simply telling a story about the data, but instead focuses on using that data to make predictions about what might happen next. Often, this is done using decision trees that move people through a list of questions until they arrive at an answer.
Why is data mining important?
The biggest reason that many businesses use data mining is to improve the customer experience. For instance, if a big tech business notices that sales of a popular product are always up during the first week of every month, they can take advantage of that and stock more of that product during the first week. Alternatively, if a small business notices that its website has a very high bounce rate, it might choose to redesign its website in order to attract customers and to make the UI experience more pleasurable for everyone.
Data mining also supports the personal contact of certain niches of customers and even individual customers through websites and in marketing. If your business has a niche of people who always interact with your posts online, you can use data mining to identify those people, put them all in one email list, and then send them promotions or another form of appreciation to reward them for their loyalty.
Finally, data mining can help to refine the business’s marketing strategy. Even massive businesses can still run into trouble figuring out how to market to their customers and what type of strategies are the best to use. Data mining can illustrate how the various social media sites are being interacted with.
Then you can look at your marketing strategy and see what your customers are responding to. If you can map the journey of a customer from your social media posts all the way to them purchasing a product or service, then you can use that data to guide other customers down the same path and generate more sales because of it.
With the proper use and understanding of data mining, you can turn your business’s data into proper cash flow, and that will help your business grow, reach more customers and make more sales!
Data mining and cybersecurity
Gathering data and learning from it isn’t just a proactive measure that you can do to generate more cash from your customers, as it can also be a defensive measure that keeps your company safe from hackers and other problems that can affect your time spent on the web. With the aid of data mining, your company can better defend itself from malware, system intrusions and other security threats, and here’s how to do it.
Data mining can help you examine through the data coming into your business and potentially detect hidden patterns and unknown threats. Here are some of the best uses of data mining to help keep your business safe:
The detection of malware
Even if you don’t know a lot about cybersecurity, you probably do know that malware is very bad for your computer and can cause a lot of problems if you aren’t protected against it. There are plenty of defenses against malware that you can use, and many of them are designed to detect that a malware attack is being attempted either by identifying the signature of the malicious code or understanding and recognizing the behavior of malware coming into the system.
Data mining can use different methods to help detect malware problems, such as detecting anomalies in the system that don’t conform to expected behavior or looking for signatures that don’t belong. Those red flags are identified and sent to you so you can examine them and stop a malware attack before it can even begin.
Malicious intrusions are one of the most common types of cyberattacks on a business. These attacks often target databases, servers and operating systems and seek to either hold data for ransom or simply sow chaos and disrupt the day-to-day business of the company.
Data mining can also help detect these attacks through evaluation of the regular network traffic. It can detect patterns in the network traffic and quickly figure out when things don’t belong and when certain behavior might signal an attack. With data mining, all these cases of irregular behavior can be categorized and any new records that are displaying the same behavior can be flagged as well, helping you keep your business safe.
Additionally, data mining can also be used to identify and protect all entry points into a network. One of the first things that many intruders look for is a computer that is only partially on the network, and then use the weak link to get inside and take down the system from within. By using data mining, every entry point can be protected and anomalies and misuse can be detected across all your devices.
Data mining can prevent fraud
One of the biggest issues that both new and old businesses will face is fraud. From check-based fraud to identity theft and investment fraud, many fraudsters are attempting to make dangerous behavior look legitimate, and that can cost your business a lot of money. It also seems as if every single fraudster is outwitting detection tools left and right, and as soon as you recognize one signal of fraud, three more pop up that you don’t know about.
Thankfully, data mining can be very helpful in detecting fraudulent activity, as various algorithms can be used to detect anomalies and the patterns of fraudulent activities. This allows the identification of fraud before it starts and prevents it causing serious problems for your business.
Data mining can detect insider threats
While many people focus on threats to cybersecurity that can come from outside the company that are seeking to get inside, there are some cyber threats that originate from inside the company to start with. These insider threats are often very hard to detect because they often involve legitimate users, such as former employees or people with access, and they often appear to be legitimate activities. As those attacking your company often know the defenses that you have, they are better able to mask their activities.
However, just because their behavior looks legitimate doesn’t mean that it is not unusual, and many data mining algorithms can detect this behavior and predict insider threats. You can then be signaled, allowing you to take action to defend your company from within.
Cybersecurity doesn’t need to be hard
Even with the aid of data mining to support the defense of your business, you might be a little worried about how to secure your business from cyber threats. However, learning about how to implement and understand cybersecurity doesn’t need to be difficult. Institutions, such as St. Bonaventure University Online, offer cybersecurity online master’s degrees, which help students develop expertise in cloud security, secure software design and data mining. A course like can develop skills for the building and maintaining of IT systems, as well as cybersecurity careers going forward.
Whether you want to defend your business from an attack or focus on turning your knowledge of cybersecurity into a career to support other businesses, earning a degree can really kickstart your cybersecurity journey.
Take advantage of all data mining can do for you
No matter the size of your business, how much you market or how many customers you happen to have, you will be using data mining in some form in order to understand your customers and why they interact with your business. If you understand how to use data mining to your advantage for your business you will be able to improve the quality of your customer experience, move your customers in the direction you want and generate more sales.
Additionally, when it comes to defending your business from cyber threats, the world of data mining can be extremely beneficial too. Don’t be afraid to take the time to understand how data mining will work the best for your business, how it can be integrated into the security of your business, and how to make sure that you are properly gathering and interpreting the data you have access to.
Once you unlock the full potential of data mining, you can also unlock the full potential of your business, and that is something every business owner should do!