Question

Predictive analytics is a hot topic and has become more needed due to the enormous increase in the amount of data available. It has become more approachable though due to the enormous increase in computing power and the development of machine learning. Think about your place of work and how you might use what we've learned to examine predictive analytics

Predictive analytics in business is an important application of multiple regression analysis. Generally, speaking, what is meant by predictive analytics? As a business owner, how could you use regression analysis and predictive analytics to increase your company's sales?

Answer 1

A) what is meant by predictive analytics?

Answer

• Predictive analytics is an area of statistics that deals with extracting information from data and using it to predict trends and behavior patterns.
• In Predictive analytics we captur relationships between explanatory variables and the predicted variables from past occurrences,and exploiting them to predict the unknown outcome.
• Often the unknown event of interest is in the future, but predictive analytics can be applied to any type of unknown whether it be in the past, present or future.
• For example credit card fraud as it occurs., customers next visit and which item likely to buy.
• Predictive analytics statistical techniques include data modeling, machine learning, AI, deep learning algorithms and data mining.
• The accuracy and usability of results will depend greatly on the level of data analysis and the quality of assumptions.

B) As a business owner, how could you use regression analysis and predictive analytics to increase your company's sales?

Answer:

1) Find customer preferences based on past transaction and then predict next purchase.

also we can calcualte purchase interval that is how frequentlly that customer purchase particular item.

2) Find customer value and also find loyal customer.

3) Also improve backend operation by optimizing inventry.For that predict items demand and use that for stock replenishment . This will help to reduce both carrying to much stock than necessary or running out of stock.Ultimatelly it will help to rediced inventory cost.