Traditionally, businesses main objective is to earn profit only through production and marketing of products. Meanwhile, modern concept of business focus more on generating profits by satisfying customers with their services and products (Das, 2019). Many businesses have been shifting its business model to a modern concept of business in order to earn additional profits and to maintain its sustainability and efficiency. However, the transition is complicated due to the lack of customers data; which is still a challenging struggle that businesses encounter. Without the help of advanced technology, it would be difficult for businesses to operate effectively.
Introducing data mining, a common process that is used to transform raw data into useful information (Twin, 2019). This process helps companies to learn more about their customers behavior in order to strategize effective advertisement, increasing sales and decreasing costs. However, the efficiency of data mining is solely based on the effective data collection, warehousing and computer processing (Twin, 2019). In the past, it cost millions of bucks and took many years to map just one business data; in which the researchers gathered some representative people to plot patterns and generalized the human behaviors. However, there is a recognizable decrease in the use of this traditional method. Businesses started to take advantage of the technology by combining all essential elements of consumer behaviors to find patterns that are more accurate.
In order to sustain and earn a competitive edge for the business, owners must always come up with a plan for long run growth and expansion while taking technology into account. Data mining will help shape the business in a different way by providing data for companies to make changes in the business in order to satisfy the desire of their customers. A good example of this process would be the accessibility of information. Before making any purchases, customers are likely to go online and search about information related with the product. With this information, data mining will give a head start to businesses and put them at the frontline. Customers will then be landed on your site which is likely resulted in a high conversion rate since customers can easily find your presence online (Mansoor, 2017).
Another example would be a real-life example from a local company, Khema Restaurants. In Cambodia, there are many companies that are trying to reconstruct their business model in order to keep up with the pace of technology. Khema is a local restaurant that provides a wide range of pastries, delicatessen and drinks. Their biggest challenges are obtaining inaccuracy data and attaining customer data. So how do they tackle the issues? They are considering a loyalty program along with a membership card to keep track of customers purchases and behaviors. This solution does not only help them obtaining the data but also can be used in the future for an advanced approach. With the data they collected, they can adapt a ‘Near Field Communication’ technology to provide a seamless dining experience which will resulted in an improvement in the relationship between customer and staff.
Let’s now take a look at Facebook. Did you know that Facebook is tracking our activities when we are using their platform? It’s surprising how Facebook is able to even tag you in other people’s picture with your face in it. Facebook has been gathering all of these personal data and sell it to businesses. Having access to more data will provide additional value for data mining – the collections of these data are labeled as ‘Big Data’ (Matchett, 2019). One of the method Facebook used to generate more data is to connect users with their online interaction programs such as ‘What will I be in the next 10 years’; this allows Facebook to run a quick access to your private information. Online businesses are in need of these types of data because it will boost interaction as well as sales to the business.
It is inevitable that technology will revolutionize and change the way business operate. However, not all changes will provide a positive result, but business should not ignore the existing of useful data that is going to impact their business. While implementing data mining, there should always be an ethical manner to do so; you need to get approval from the users to use their data for other purposes and ensure that it would not lead to a negative impact.
List of References:
Dash, N. (2019). Difference between Traditional and Modern Concept in Business. Retrieved from https://www.ilearnlot.com/difference-between-traditional-and-modern-concept-in-business/59901/
Evans, P. (2013). How data will transform business [Video File]. Retrieved from https://www.ted.com/talks/philip_evans_how_data_will_transform_business/transcript?language=en
Mansoor, H. (2017). 6 Ways Technology Impacts Customer Thinking, Behavior, And Experience. Retrieved from http://customerthink.com/6-ways-technology-impacts-customer-thinking-behavior-and-experience/
Matchett, M (2019). Facebook and Data Mining: Is Anything Private? Retrieved from https://www.datamation.com/big-data/facebook-and-data-mining.html
TODAY. (2016). How Facebook Data Mining, And You Info, Is Influencing the 2016 Election [Video File]. Retrieved from https://www.youtube.com/watch?v=i-rIYadXoms
Twin, A. (2019). Data Mining. Retrieved from https://www.investopedia.com/terms/d/datamining.asp
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