July 31, 2013
Statistics has become a part of our life, and not just our professional but personal sphere equally. You might wonder and may even awe at the levels to which we are touched by it. The retail store you go to buy groceries would have an analytic team working at the backend using your shopping list to improvise their portfolio, the DTH company you must been subscribed to would analyse your television viewing pattern to define a better channel package, in fact even the search engine which might have brought you here uses quite a lot of your personal information (much to our chagrin) to decide ad rates for the companies who fancies up your ticker or sidebar of browsers.
While there are cynics and critics who shun such practices, the world we live in is differentially inclined towards the enthusiasts who see statistics or analytics (used interchangingly here) as our tool for improvement or pioneer for future.
Analytics has become pervasive due to two basic reasons: firstly due to humungous amount of data collected via various EDI (Electronic Data Interchange) devices like Barcode scanner (The device you see at the Mall counters, while you mull over the reason why your queue moves slower than others) , RFID tags(The one you might see at the non-stop toll gates) and even the cookies saved on your computer browsers. This data explosion where the amount of data being collected today is even outstripping the capacity of organizations to store it, has led to innovative solutions like Cloud services or SAS (Software As Service, don’t confuse this with the popular statistical software) and et.al. Data is increasing substantially as a result of the Internet revolution, such as the use of social media, and the use of digital mobile devices, such as Smartphones, Tablets (and a host of other hybrid devices). It is estimated that business data alone is doubling in size every 1.2 years. In 2011 it was predicted that 1.8 Zettabytes of data will be collected and stored in the world. A zettabyte is equivalent to one trillion gigabytes of data or approximately thousand trillion books.
The second reason analytics has become so important is because the challenge of converting the huge amounts of data available to knowledge. Analytics is the discipline that uses various data-mining techniques to extract knowledge from data. This is needed to assist organizations to solve problems and reach decisions. For example, analytics can identify which customers are the most profitable to a firm and which incentives are likely to entice them to buy more products. It has not only opened venues in this ever competitive market but has become as competitive differentiator, for example Amazon was the first retail company to track the buying pattern of its users and analyse them to predict and suggest products they are most likely to buy in future; not to mention many of new avatars of online retails now con the same methodology.
We would like to delve deep into the ocean of analytics in our coming articles, so look out for this space.
For cynics who still don’t hold candle to this evolving trend, we’d say