Data Mining Applications (1 of4 Customer Relationship Management Maximize return on marketing campaigns Improve customer retention(churn analysis) Maximize customer value(cross-, up-selling Identify and treat most valued customers Banking other Financial Automate the loan application process Detecting fraudulent transactions Maximize customer value(cross-, up-selling) Optimizing cash reserves with forecasting Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Data Mining Applications (1 of 4) • Customer Relationship Management – Maximize return on marketing campaigns – Improve customer retention (churn analysis) – Maximize customer value (cross-, up-selling) – Identify and treat most valued customers • Banking & Other Financial – Automate the loan application process – Detecting fraudulent transactions – Maximize customer value (cross-, up-selling) – Optimizing cash reserves with forecasting
Data Mining Applications (2 of4 ° Retailing and Logistics Optimize inventory levels at different locations Improve the store layout and sales promotions Optimize logistics by predicting seasonal effects Minimize losses due to limited shelf life Manufacturing and maintenance Predict/prevent machinery failures Identify anomalies in production systems to optimize the use manufacturing capacity Discover novel patterns to improve product quality Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Data Mining Applications (2 of 4) • Retailing and Logistics – Optimize inventory levels at different locations – Improve the store layout and sales promotions – Optimize logistics by predicting seasonal effects – Minimize losses due to limited shelf life • Manufacturing and Maintenance – Predict/prevent machinery failures – Identify anomalies in production systems to optimize the use manufacturing capacity – Discover novel patterns to improve product quality
Data Mining Applications (3 of4 Brokerage and Securities Trading Predict changes on certain bond prices Forecast the direction of stock fluctuations assess the effect of events on market movements Identify and prevent fraudulent activities in trading Insurance Forecast claim costs for better business planning Determine optimal rate plans Optimize marketing to specific customers Identify and prevent fraudulent claim activities Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Data Mining Applications (3 of 4) • Brokerage and Securities Trading – Predict changes on certain bond prices – Forecast the direction of stock fluctuations – Assess the effect of events on market movements – Identify and prevent fraudulent activities in trading • Insurance – Forecast claim costs for better business planning – Determine optimal rate plans – Optimize marketing to specific customers – Identify and prevent fraudulent claim activities
Data Mining Applications (4 of4 Computer hardware and software Science and engineering Government and defense Homeland security and law enforcement Travel, entertainment, sports Healthcare and medicine Sports,. virtually everywhere Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Data Mining Applications (4 of 4) • Computer hardware and software • Science and engineering • Government and defense • Homeland security and law enforcement • Travel, entertainment, sports • Healthcare and medicine • Sports,… virtually everywhere…
pplication Case 4.3 Predictive Analytic and Data Mining Help Stop Terrorist Funding Questions for Discussion 1. How can data mining be used to fight terrorism? Comment on what else can be done beyond what is covered in this short application case 2. Do you think data mining although essential for fighting terrorist cells, also jeopardizes individuals rights of privacy? Pearson Copyright C 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved
Copyright © 2018, 2014, 2011 Pearson Education, Inc. All Rights Reserved Application Case 4.3 Predictive Analytic and Data Mining Help Stop Terrorist Funding Questions for Discussion 1. How can data mining be used to fight terrorism? Comment on what else can be done beyond what is covered in this short application case. 2. Do you think data mining, although essential for fighting terrorist cells, also jeopardizes individuals’ rights of privacy?