What is 'data mining'? How does it help organisations in taking considered and knowledge driven decisions ?

Data mining is a process of extracting hidden information from large databases. It involves the use of various data analysis tools to discover new facts, valid patterns and relationships in large data sets. Data mining tools predict future trends and behaviors, allowing businesses to make proactive, knowledge-driven decisions. For a commercial business, the discovery of previously unknown statistical patterns or trends can provide valuable insight into the function and environment of their organization. Further, it could assist an organization in taking considered and knowledge driven decisions in the following manner: It facilitates in extracting meaningful patterns; It helps in analysis about which product or service is having better performance It assists in planning and prediction It assists in designing marketing, pricing and operational strategies. It also helps in understanding various other factors such as consumer behavior, product performance, market predictions, performance of advertising campaigns, shelf space allocations etc.