Benefits and examples of Predictive Analytics
Predictive analytics uses past and current datasets to forecast events and generate insights.
This helps organizations to detect risks and uncover opportunities, by generating actionable outcomes that an organization can use to reach its goal.
Below, we identify the benefits of predictive analytics, and how it can be used across many industries.
Predictive Analytics Benefits
Predictive Analytics gives accurate and reliable insights, helping organizations to solve problems and identify opportunities. Such as:
Predictive Analytics can identify patterns to detect and prevent criminal behaviour. As cybersecurity increases, Predictive Analytics helps to identify abnormalities that may indicate cyber vulnerabilities and threats. This helps organizations put relevant procedures in place, and keep their data and business safe from fraud and other online threats.
Predictive Analytics is used in the finance and insurance sectors to construct accurate and reliable pictures of customers, in order to help with effective decision making. For example, credit scores determine the creditworthiness of an individual – which helps to reduce the organization’s risk.
Optimising Marketing Campaigns
Determining customer responses and purchases is very important in marketing strategies, and Predictive Analytics helps to analyse data to identify new opportunities to attract or retain customers.
Improving Decision Making
Predictive Analytics allows for more advanced decision making. The more data that the software has available, the better-informed decisions you can make. It can identify patterns and trends in large amounts of data, providing organisations insight, that previously may not have been available.
Improving Efficiency in Operations
Predictive analytics helps to forecast inventory and manage resources, to make organizations more efficient, and help to optimise performance and increase revenue. It helps proactively improve their production processes and take appropriate actions when needed.
Where Can Predictive Analytics Be Used?
Predictive analytics is used in a variety of industries, and can be relevant and applied in lots of sectors. Here are some industry examples of where Predictive Analytics can be used, but is not limited to:
Banking and Financial Services
With huge amounts of data and money, the financial industry uses Predictive Analytics to detect and reduce fraud, measure credit risk, maximise up-sell and cross-sell opportunities and retain valuable customers.
Predictive Analytics can also be used in the Debt Collection and Personal Lending industry – as it helps to create a 360 degree portrait of the client, taking into consideration more details than ever before – including sending patterns and even social media. Using Predictive Analytics also helps businesses to estimate future cash flows and make accurate projections of expected receivables.
Predictive Analytics help with merchandise planning and price optimisation, to analyse the effectiveness of promotional events and determine which offers are most appropriate to customers.
Predictive analytics helps with the design and optimisation of clinical trials, as it analyses medical histories of patients to determine which ones will respond best to a drug tested. They can also help with research on possible side effects of a drug and the segmentation of patients based on their likelihood to respond well to a drug.
Preventing patient re-admissions to hospitals and predicting patient health decline are two ways in which the Healthcare industry uses Predictive Analytics.
The Insurance industry uses Predictive Analytics to help businesses prevent customer churn and keep customers for a longer period of time. They can score customers on their lifetime value they stand to offer so that companies can find new ways to market and target these customers.
Oil, Gas and Utilities
Predictive Analytics helps to predict equipment failures and resource needs, reduced safety and reliability risks, and improve overall performance.
Government & Public Sector
The Government can understand population trends and improve service and performance, detect fraud, and understand consumer behaviour using Predictive analytics.
Predictive Analytics helps organizations to predict the impact of specific maintenance operations on aircraft reliability, fuel use and uptime.
Predictive Analytics is a tool that can be used and implemented in a wide variety of industries and situations. To learn more about how it can be utilized in your business, contact us now to see how we can help.