Best Buy Executive Summary

Pilot stores that were remodeled to cater to these segments with sample home theater areas, a gaming/technology station, newly trained staff, and targeted advertisements were gaining a lot more profit than traditional stores. The changes were worth the additional costs of specialists, training, and refurbishing, and now all stores have been changed to reflect the new marketing strategy (McWilliams, 2004). In the present Best Buy is still showing a profit even during lean times when competitors are suffering. Data mining is also capable of determining the Lifetime Value (LTV) of a customer which determines how long they are likely to stay and how profitable they will be during that time. Same as Best Buy, telecommunication companies are aware that not all customers are created equally. Creating a LTV for customers builds on what is known about current customers and extrapolates it into the future. According to the four analysts Drew, Mani, Betz, and Datta from Verizon laboratories their company is already integrating LTV into customer retainment decisions and its more advanced Gain in Lifetime Value (GLTV). Verizon first creates a customer's hazard function which is the probability that they will leave based on how long they have been a consumer

Companies employ a number of data collecting methods across their many departments. In order to be useful data needs to be in the same format, with clear description so what they are, checked for validity, and redundant files compiled. This can take time since just an accounts payable department could have phone messages, emailed messages, and typed messages that all need to be changed and documented. Failure to understand and prepare data properly can lead to false results and wasted time both of which hurt the company (Olsen & Delen,