The Role of Data Warehousing The customer-focused enterprise regards every record of an interaction with a client or prospect—each call to customer support, each point-of-sale transac tion, each catalog order, each visit to a company Web site—as a learning opportunity. But learning requires more than simply gathering data. In fact, Why and What Is Data Mining? many companies gather hundreds of gigabytes or terabytes of data from and about their customers without learning anything! Data is gathered because it is needed for some operational purpose, such as inventory control or billing. And, once it has served that purpose, it languishes on disk or tape or is discarded.
For learning to take place, data from many sources—billing records, scanner data, registration forms, applications, call records, coupon redemptions, surveys—must first be gathered together and organized in a consistent and useful way. This is called data warehousing. Data warehousing allows the enter prise to remember what it has noticed about its customers. Customer patterns become evident over time. Data warehouses need to support accurate historical data so that data mining can pick up these critical trends. One of the most important aspects of the data warehouse is the capability to track customer behavior over time. Many of the patterns of interest for customer relationship management only become apparent over time. Is usage trending up or down? How frequently does the customer return? Which channels does the customer prefer? Which promotions does the customer respond to?