The Importance Of Data Mining In Retail Industry

Abstract

Thanks to the continuous advancements in data mining, which is an interdisciplinary subfield of computer science and statistics, it has become significantly easier for the retail industry to improve customer service, acquire and retain new consumers by developing products in demand, and compete successfully in the marketplace. As a reason, data mining allows retail companies to analyze product sales trends, customer buying habits as well as preferences, delivery performance, customer peak traffic, and supplier lead times. Consequently, retail companies are now able to control the costs required for the development of existing products, innovate new targeted brands, and dispose of the products that are no longer in use by their customers. This article will provide background information related to data mining, how it became an inextricable part of retail industry, and the advantages as well as disadvantages of exploiting this powerful tool by retail companies.