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Tech Update CRM
Data mining: Digging user info for gold
By Rachel Konrad
Special to ZDNet
February 9, 2001


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You like science fiction books, and Amazon.com wants to sell them to you. So why does the e-commerce giant peddle DVDs, Q-Tips and Valentine's Day chocolates when you click on its site?

The answer is simple, scientists say: Amazon.com and most other e-tailers have yet to perfect a practice known as "data mining," the use of statistical analysis to uncover hidden patterns in otherwise random information.

Experts predict data mining will be one of the most revolutionary developments of the next decade, key to delivering a "personal Web," tailored to an individual's preferences, by identifying a useful structure in collected information and analyzing it in real time. The influential MIT Technology Review recently hailed data mining as one of the 10 emerging technologies that will "change the world."

But some academics warn that mainstream mining merely "dumbs down" the sophisticated craft--and may result in screwy conclusions. Already, analysts are cautioning potential investors that the volatile segment may be unduly hyped. "A lot of people think, 'I'm just going to put this in the hands of the marketer and we'll get the secret sauce,'" said Bob Moran, a managing vice president at the Boston-based Aberdeen Group. "But there's no such thing as 'secret sauce.' Data mining is all about pushing back the gray zone. It's never entirely uncovering the black and white."

[an error occurred while processing this directive]
r is simple, scientists say: Amazon.com and most other e-tailers have yet to perfect a practice known as "data mining," the use of statistical analysis to uncover hidden patterns in otherwise random information.

Experts predict data mining will be one of the most revolutionary developments of the next decade, key to delivering a "personal Web," tailored to an individual's preferences, by identifying a useful structure in collected information and analyzing it in real time. The influential MIT Technology Review recently hailed data mining as one of the 10 emerging technologies that will "change the world."

But some academics warn that mainstream mining merely "dumbs down" the sophisticated craft--and may result in screwy conclusions. Already, analysts are cautioning potential investors that the volatile segment may be unduly hyped. "A lot of people think, 'I'm just going to put this in the hands of the marketer and we'll get the secret sauce,'" said Bob Moran, a managing vice president at the Boston-based Aberdeen Group. "But there's no such thing as 'secret sauce.' Data mining is all about pushing back the gray zone. It's never entirely uncovering the black and white."

But marketers who recognize its vast commercial potential see data mining as more than black and white. They also see green in the science's potential to create higher margins and inflate revenue.

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1. Data mining: Digging user info for gold
2. Does it make sense?
3. Dancing around privacy
4. Data mining makes inroads





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