Market by Year 2000 ACTION ITEMS
META Group, Inc. announced the results of a pioneering study of data mining imperatives. The study, entitled Data Mining: Trends, Technology, and Implementation Imperatives, forecasts 150% growth in the data mining market, from $3.3 billion in 1996 to $8.4 billion in 2000.
Additionally, the study reveals that:
This rapid growth will be driven by database marketing, which includes such application areas as customer retention and churn management; cross-selling and up-selling; campaign management; market, channel and pricing analysis; and customer segmentation analysis.
Data mining market segments that will benefit the most from this growth include macromining (+3%), package vendors (+9%), and systems integrators (+14%).
50% of the Global 2000 enterprises surveyed believe data mining is critical to their goals over the next two years.
"The competitive advantage enjoyed by the technology elite that deployed data mining early on is certain to dissipate through the Year 2000," said Aaron Zornes, META Group executive vice president and director of its Application Delivery Strategies service. "Driven by the need for customer-centric marketing, data mining technology is rapidly becoming mainstream. IT and marketing departments that don't stay on top of this trend will wake up to discover that their competitors have beaten them to the punch. Our report makes available to the market extremely valuable insight that has, to date, been closely guarded as corporate stealth technology to protect competitive advantage."
According to META Group, customer-centric marketing requires sophisticated data mining applications because it seeks to better understand customers in their totality: buying patterns, demographic and psychographic trends, and other types of customer knowledge that make it possible for enterprises to develop focused marketing strategies.
Study Methodology
The results of META Group's study are based on written and telephone interviews with IT management, business technologists, data mining project leaders, and market scientists at more than 120 companies, one-third of which are currently deploying data mining applications, and two-thirds that are planning to do so in the next 18-24 months. Leading technology vendors providing services, software and hardware to support data mining applications were also interviewed. Information gathered in this process offers IT and line-of-business managers information on:
The critical business issues driving the data mining business requirement, and actual and perceived obstacles; How data mining will be used for competitive differentiation; Data mining products and services that have major mind share; Key criteria in the vendor selection process; The processes and decision points for acquisition of data mining products and services; and How data mining fits into an overall data warehouse strategy.
According to META Group, data warehousing and data mining are complementary. Data warehousing and online analytical processing (OLAP) provide top-down, query-driven data analysis, while data mining provides bottom-up, discovery-driven analysis. Data mining requires no assumptions. Rather, it identifies facts or conclusions based on patterns discovered.
Pricing and Availability
Data Mining: Trends, Technology, and Implementation Imperatives is scheduled for release in November 1997. It will cost US $2,500. An executive summary of the study can be downloaded from the company's Web site ( http://www.metagroup.com ). The full report can be obtained by contacting META Group (800-945-META). META Group currently serves more than 1,300 clients worldwide.