Towards Using Knowledge Discovery Techniques in Database Marketing for the Tourism Industry

Abstract

SUMMARY Given the trend that international corporations are utilizing various information systems for their daily activities, information on sales transactions together with corresponding customer profile is usually available in airlines and international hotel chains. This allows segments of customers to be drawn according to selected relevant demographic variables. This is referred to as Database Marketing, a new trend in marketing that makes use of information available in a company's database. The extracted information is also useful in planning marketing strategies, launching new products/services and defining market segmentation. As databases in large corporations nowadays are getting large, sparser, more free-formatted and more dynamic, traditional statistical techniques may not be capable of extracting the encapsulated knowledge inside the databases. A new technical stream, data mining has been developed in Computer Science to deal with the complex task of extracting and managing any potential knowledge embedded inside databases. This paper introduces the common techniques in data mining, including decision tree classifiers, regression analysis, induction programming logic, and probabilistic rules. Suggestions are offered about how these techniques can be used in order to improve the engineering behind Database Marketing, which can help to promote niche markets in tourism. By utilizing its know-how in Database Marketing, a company can sharpen its competitiveness and build entry barriers for others.