Data Analysis in the Marketing Field

Data Analysis, or Data Mining, is one of the most important parts of the Data Science spectrum. This is basically when companies find relationships and patterns in the data in order to come to conclusions. Data Analysis is used in the marketing field in order to make better business decisions, and make the most profit. We all learned about estimation in elementary school- making an educated guess. Well, Data Analysis is similar, but the educated part is instead analyzing trends and patterns. Although we cannot predict the future, we can use graphs of sales to make very accurate guesses on what the future will look like for a company. For example, say there was a toy company, like FAO Schwarz. Let’s say the company has a monthly graph with each toy and its amount of sales. For the example’s sake, let’s pretend that one of the toys seems to not be selling as well. The remote controlled car has the least sales of all the other toys. Now the company can look into why that might be. Is it because kids don’t like remote controlled cars anymore? Is it because the price is too high? It is because the car is not fast enough or doesn’t have good features? To make the final conclusion on what the problem is, the company must research remote controlled cars in other stores. In target the remote controlled car has the same features, but it is $15 cheaper. Perhaps that is why the FAO Schwarz remote controlled car is not selling. Therefore, they can reduce the price and keep track of the sales for the next few months. This graph of sales can be used to make many other patterns as well. For example, the red and green train set sells the best around Christmas time. Maybe this is because it looks like a holiday train and people like to put trains around their Christmas tree. The sales for the red and green train set are not as good around the summertime, because kids don’t want holiday train sets in the summer. Therefore, the production of this item can be halted in the summer and only be made in the winter. Through this, the FAO Schwarz can save money from producing this toy, and instead use the materials, space, time, and equipment for a more summer geared toy, such as paddle ball set. As can be seen, analyzing patterns in the sales of a store can help the company make better decisions to make more profit.