Tuesday, December 8, 2009

Customer behaviour = real intelligence !

Nothing artificial about it... real custoemr intelligence comes from understanding your business, and how customer behaviour gets reflected in the data you capture about customer interactions.

Many data mining experts today come from one of two schools - first the traditionalists who are dyed in the wool statisticians. These folks are plenty smart, but are first and foremost mathematicians and they draw their insights from interpretation of mathematical modeling techniques. They can glean powerful insights about the correlations among your data.. but is that really meaningful ? Is not customer behaviour - and it's dynamics not more to the point ?

The second school of data miners are those who use current generation data mining tools and advocate the concept of  self-service data mining. Tools have become much easier to use, with GUI interfaces and process logic that manages things - like covariance - that it used to require a mathematician to control when designing models. These tools are great - they reduce the mathematical knowledge required to create models and accelerate model production. But are they measuring things that really matter ? Is this more data or more information ?

Our sense is that it is imperative to apply deep business knowledge to the process. Understanding who your customers are, why they buy / use your products, what they like and dislike, and how they behave under varying circumstances is crucial to obtaining real inferential insights about customer behaviour. Unless you know what is an aberration and can separate real from false positive behaviours models are essentially just more data that has limited value for business decisions.

Liberate yourself from the tyranny of the math ! Model your customer interactions and search out the menaingful indicators of relationship change. Getting these basics right can save you a ton of money and improve service to boot.-DBM
Share/Save/Bookmark

0 comments:

Post a Comment

Comments are moderated. This is a DoFollow blog.

Note: Only a member of this blog may post a comment.