How Do Companies Use Data Mining?

data mining


Data mining is a process of data science technology. The data science technology works completely on the data so do the data mining. In this technology, many processes are involved, but data mining is said to be the most important one. In the data mining process, the collected data is analyzed for discovering the hidden patterns in it. The data is collected before analysis. The data which is collected is in impure form. This means that all the data which is accumulated is not of use. We have to use only useful information from it. That’s why data mining is done.

The data mining process discovers the hidden patterns from the data which is further used for solving the problems. The data is divided into sub-parts and then data mining is performed on them. After the process, the data is integrated again. All these tasks are executed and accomplished at the place called data warehouses. The data mining process is majorly used by companies. This is so because this process helps in reducing the overall cost with higher revenue.


Here the steps followed in the data mining process are described precisely. They are listed below:

  • The data is first collected from the people with the help of different methods. 
  • After the collection of the data, it is transformed. 
  • After the transformation, the data is loaded into the data warehouses. 
  • When the data reach data warehouses, then it is managed and stored in the multidimensional databases. 
  • When the data is stored in the databases, the authorization is provided to the data scientists or data analysts for accessing the data. This is done with the help of application software. 
  • The data is then finally represented into easier and readable forms. For example, graphs, charts, etc.


At present, the companies are implementing the data mining process for making their business more efficient. Of course, the data mining process also provides high revenues at a low cost. This is another reason for using data mining in companies.

The first step of the companies is to gather the required data. Generally, the data of the company is classified into three types which are:

  • Metadata
  • Transactional
  • Non-operational 

The transactional data covers that data on which operations are performed on each day. For example, costs, inventory, sales, etc. Non-operational data includes the data of forecasting etc. While the metadata consists of the logical designs of the databases.


The most important thing for a company is the customers. For the success of a company, the company must have a strong base of customers. It is very important to keep your customers attracted to your company. Many companies fail to do so because they don’t know about what products their customers are looking for? Many companies are very slow. They are slow in understanding the needs of their customers. When a company slowly understands the needs of the customers, then they start to deploy the products of poor quality which are not appreciated and liked by the customers.

The data mining process helps in understanding the need of every customer by discovering hidden patterns from the data and by deep analysis of the data. One strong example of this is when looking at adult dating and hookup applications. Free sex apps like Meetnfuck App utilized data from users on other top casual sex sites in order to tailor their platform to better fit the needs of their target demographic. The examples of data mining to better understand customers are endless. Another example of this would be food delivery applications. We get many offers on food items every day. What these food delivery companies do is analyze the shopping behavior of every customer. They analyze that which food item is frequently purchased by which customers. Then they make the clusters of those customers who purchase the same food items. Then they provide special offers to the customers accordingly. In this way, the data mining process help in building a strong customer base.


The companies invest a huge amount of money in the marketing and advertisement campaigns of their products. Even after this, many of them fail in promoting their products. This is so because the marketing and advertisements are not reached to the right audience. As said above, the data mining process help in understanding the needs of the customers. After knowing the needs of the customers, companies can easily deliver the products. The data mining process helps in keeping an eye on the online activities of the customers. For example, for what products they are searching for, which products or types of products are liked by the customers, etc.

The data mining process helps in doing the advertising and marketing to the targeted audience. This activity results in a lower cost with an efficient result. The best example of this would be Netflix. If you have the subscription of Netflix then you would better know that this application suggests next movies or series watch after finishing one. Netflix does so by analyzing the past data of its customers. It analyzes the past data as well as the last movies or series you have watched. Based on that analysis, it gives new suggestions. This activity also helps in building good relations with customers. That’s why data mining is being used by many companies around the world.


The companies have one more reason to use data mining in their business which is risk management. The data mining process prevents the company from many risks. The data mining process for risk management is more useful for financial institutions. The companies have to face many fake people who do not return the borrowed money. This activity leads the company to debt. With the help of data mining, the companies analyze the past data of their customers. The analysis of the internal data is preferred by the companies first. After the analysis, they decide whether it is safe to approve the loan to the applicant or not. Along with this, the data mining process also increases the quality of the tools which are used in risk management.