Briefs

DM Direct Newsletter, May 5, 2006, By Doug Freud and Rohit Tandon

According to Forrester, by mid 2006 more than 85 percent of consumer-oriented firms plan to target marketing messages to one or more inbound interaction channels.1 But, of the firms that do this today, most use only basic business rules instead of predictive analytics to determine the message the customer receives.

Predictive analytics, which examines historical information using data mining algorithms, allows businesses to make more accurate predictions on future events. IDC found that business applications involving predictive analytics software generate an average ROI of 145 percent, much higher compared to other types of business intelligence (BI) software.2 Regardless of why companies are not implementing these applications, it is becoming increasingly apparent across a variety of industries that businesses must evolve their processes to include predictive analytics, or they will not remain competitive.

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