How as humans, do we learn to perform a task? We train, perform the task, evaluate our performance, make adjustments and improve, before repeating the process all again. Believe it or not, a similar process is used with machines. Welcome to the world of machine learning for business analytics!
Why is machine learning useful in business?
- It allows you to segment your market.
- It enables more accurate predictions of customer behaviour (for example, whether a customer is likely to respond to a discount).
- It can identify anomalies in your data, allowing you to monitor the activity of your business more closely.
What is machine learning?
Or rather, how do machines learn? Humans solve problems with intuition, whereas machines benefit from being able to perform billions of calculations per second if necessary. Machine learning splits data into sets of training data, the data it will use to process and build a model from, and test data, which it uses to score the accuracy of its model.
By applying and repeating this process of training and testing on customer data or sales transactions, you are using a form of ‘supervised learning’ on your data. You can begin to identify key clusters within your data that you did not know about before, and begin tailoring specific products or services at each cluster to determine the accuracy of the model from your sales data. Use new sales data to continuously improve the model and the final product is a cutting-edge recommendation engine for your company website.
This can be applied to predict customer behaviour, new trends, seasonal changes in your sales data, optimize your product life cycles, and many more potential uses.
Why do I need machine learning?
A good business can weather a storm and respond to a crisis. We believe a great business can anticipate a crisis and minimise its impact.
When we work with your data, we expose it to the cutting edge of business analytics. Using techniques in machine learning, we help you categorise your customers, predict your sales, and anticipate changes in your market. We use machine learning algorithms to create models of that become more sophisticated as more data flows in, adjusting themselves automatically to predict the most accurate relationships and generate better forecasts.