Traditional marketing research often involves assessing the overall market for a good or service, surveying consumers about their likes and dislikes, and conducting focus groups to gauge consumer responses to a new product. The growth of information technology has transformed market research, with a growing number of analysts learning about consumer preferences and buying habits by mining massive sets of quantitative data and employing complex algorithms to uncover patterns and correlations that enable more effective marketing.
Data Mining Features
Data mining uses statistical techniques to discover correlations between different factors and variables in large data sets, according to Yale University Professor Ian Ayres, author of “Super Crunchers.” These data sets are often measured in terabytes, a terabyte being equivalent to 1,000 gigabytes. Data mining often gives businesses enormous amounts of information about their customers’ behaviors and buying habits, enabling them to more effectively market their goods.
Data Mining Examples
Ayres cited online retailer Amazon.com’s feature that tells a potential customer that people who like one particular product also like certain other items as an example of marketing through data mining. In another example, credit card issuer Capital One generates for its customer service representatives a list of products and services that a consumer is likely to buy based on characteristics of the customers’ credit card accounts.
Traditional Market Research
While data mining emphasizes extracting predictive information about customers and sales from large databases, traditional marketing research focuses on identifying factors that influence the buying decisions of households and organizations. Relevant data is then collected, often through sales data, surveys and focus groups, according to Professor Roger A. Kerin, author of the textbook “Marketing.” Traditional market researchers identify an opportunity, collect the needed information, then formulate an appropriate sales strategy. Data mining relies on information that is already available.
Data mining has transformed the market research field, fueling growth in job opportunities in this profession. The U.S. Bureau of Labor Statistics has projected above average growth in market research job opportunities, with the best opportunities existing for men and women with advanced degrees and strong quantitative skills that enable them to extract meaning from data.
“Super Crunchers”; Ian Ayres; 2007
“Marketing (8th ed.)”; Roger A. Kerin; 2006
Bureau of Labor Statistics: Market and Survey Researchers
University of California, Los Angeles: Data Mining: What is Data Mining?
About the Author
Shane Hall is a writer and research analyst with more than 20 years of experience. His work has appeared in “Brookings Papers on Education Policy,” “Population and Development” and various Texas newspapers. Hall has a Doctor of Philosophy in political economy and is a former college instructor of economics and political science.