Tuesday, 2 August 2016

How to create business value by applying machine learning on Sales Data

Business Analytics on Sales Data-

Of the hundreds of areas, big data and analytics will revolutionize marketing and sales, the following is an overview of those that are delivering results today.
How prices are defined, managed, propagated through selling networks and optimized is an area seeing rapid gains.  Attaining price optimization for a given product or service is becoming more possible. Thanks to advances in big data algorithms and advanced analytics techniques. Streamlining routine pricing decisions in commodity-driven industries where products are inelastic is also happening today.

Taken from Forbes, 9-5-2016
 Business Value lies in revenue increment and cost reduction. Above image shows the components of both.Pricing analytics, demand forecasting,Customer Insight analytics, customer targeting,product launch analysis, risk analysis are different areas where direct analytical model like Arima/Garch( Time -Series Forecasting), RFM Analysis, Classification, Clustering and Conjoint Analysis can be applied directly.

Clustering is widely used in customer segmentation which enables sales and marketing strategy to be segment specific.

Plethora of predictive models/ data driven approach ( as mentioned in above diagram) are not sufficient. There has to be convergence of big data, analytics and visualization.Visualization must be immediate so that nothing goes awry.

Acquiring right customer with reduced cost of keeping engaged is cash cow while complicated analytics helps in identifying stars and dogs.
Thus we see how data must be integral part of decision making in any organization. Lot of things are already done and ML is already geared up for bigger impact in near future.

if you are interested to know basic machine learning approaches  to optimize an e-commerce site-
 Business Analytics on an E-Commerce Site

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