The Power of Predictive Analytics

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1 The Power of Predictive Analytics Derive real-time insights with accuracy and ease SOLUTION OVERVIEW

2 KXEN S INFINITEINSIGHT AND SYBASE IQ FEATURES & BENEFITS AT A GLANCE Ensure greater accuracy of predictive models by using thousands of variables and full datasets Achieve performance gains of X via in-database analytics and query optimizer Obtain superior price/ performance through extreme columnar data compression and associated physical storage cost savings Automate predictive models through KXEN s InfiniteInsight with built-in support for in-database analytics Realize time-to-value with KXEN s InfiniteInsight in minutes not weeks In an age of demanding customer expectations and increasingly aggressive competitors, organizations are rapidly moving from reliance on business intelligence (BI) tools that provide a snapshot of the past to those that provide an accurate picture of the present and a prediction of future trends. This branch of data mining known as predictive analytics is the latest front in the battle for the advancement of BI tool capabilities, as customers demand not only an understanding of what happened in the past, and why, but also want to be able to accurately predict what is going to happen in the future. The central element of predictive analytics is the predictor, a variable that can be measured to predict future behavior. Businesses that rely on predictive modeling follow a process that involves collecting data, developing a statistical model, and then making predictions, which enable validation or revision of the model. Predictive Analytics Demands a New Approach The value of predictive analytics is substantial and can be measured in terms of competitive advantage, significant cost savings, and greater revenues. Yet the very large data sets often required (sometimes hundreds of terabytes of raw data) and the query-intensive and predictive-scoring workloads and models involved, place additional pressures on information technology infrastructures. Earlier solutions for data modeling encompassed a relational database designed to support business transactions, not analytics; and a data model tool that had limitations of the amount of data it could support resulting in poor data accuracy and timeless of results. Sybase IQ is a column-based analytics server that is purpose-built for predictive analytics. Analytical queries, by nature, involve only certain attributes. Sybase IQ stores and retrieves attributes by columns, rather than by rows. Since each column is stored separately, the data it contains becomes its own index. This combination results in up to 70% data compression, allowing more data to be analyzed in the models for better accuracy and speed. 1

3 Sybase IQ provides a solid foundation for predictive analytics, but models and visualization techniques are needed to extract value from massive amounts of live and historical data. KXEN's InfiniteInsight utilizes Sybase IQ In-Database Analytics Option to provide an extensive library of built-in numerical, statistical and predictive analytics functions, so that query results can be immediately analyzed within the Sybase IQ analytics server. Together, they produce query speeds on large data sets up to 100 or even 1,000 faster than traditional relational-based solutions and earlier data mining systems. Predictive analytics also demands handling up-to-the-minute live data interactions, which can be found in blogs and social media sites. By analyzing data as it is occurring, companies optimize business processes based on real-time intelligence, and make offers typically online when users are likely to be most interested. The in-memory Event Stream Processing (ESP) solution from Sybase derives intelligence from events as they are happening by monitoring data coming in live. By providing the brains to absorb, aggregate, correlate, and analyze events, Sybase ESP can trigger an alert or an appropriate response to business-critical events, while also providing high-level information on the current state of the business. Stream Data Low Latency Ops Data Sybase Analytics in the Data Center EVENT STREAM PROCESSING Stream Data Predictive Analytics Architecture Memory Disk IQ Sybase IQ Processing within Millisecs Alerts Actions Processing within Sec/Min/Hours Communications Customer Acquisition Cross-Sell and Up-Sell Churn and Rotational Churn Multi-Sim analysis Next Best Activity Social Network Analysis Fraud Financial Services Customer Acquisition Retention and Churn Next Best Activity Credit Scoring and Risk Fraud KXEN S INFINITEINSIGHT, THE PREDICTIVE ANALYTICS LEADER KXEN is revolutionizing the way companies use predictive analytics to make better decisions. Based on patented innovations, the company s flagship product InfiniteInsight delivers orders of magnitude improvements in speed and agility to optimize every step in the customer lifecycle including acquisition, cross-sell, up-sell, retention and next best activity. ETL Healthcare Customer Care Pre-emptive Levels of Care Historical Data Application Servers Near Real-Time Updates Retail Acquisition Cross-Sell and Up-Sell Retention Customer Segmentation Product Recommendation Market Basket Analysis Figure 1. Unique real-time analytics architecture combines speed + depth of analysis This combined technology solution eliminates many of the problems with earlier data mining solutions from data in various sources, inflexible and inadequate tools and algorithms, poor accuracy and timeliness of results, and the maintenance involved in creating, deploying, and modifying data models. 2

4 SYBASE IQ: THE RIGHT FOUNDATION FOR PREDICTIVE ANALYTICS Sybase IQ infuses organizations with fast, flexible access to information and analytics. With Sybase IQ, you can predict customer trends, forecast supply chain inventories more accurately, detect and prevent fraud, and optimize marketing results in ways never before possible. The economics of Sybase IQ put a faster, more efficient, cost-effective predictive analytics system will within reach. KXEN AND SYBASE, REVOLUTIONIZING PREDICTIVE ANALYTICS KXEN is cited as a leader in its sector in the Forrester Wave : Predictive Analytics & Data Mining Solutions, Q report, published on February 4th, The independent research company s first assessment of nine global movers and shakers in predictive analytics and data mining (PA/DM), stated that KXEN [is] at the forefront of the convergence of PA/DM, content analytics and social network analysis for Web 2.0 environments. Forrester s Jim Kobielus writes in the report that KXEN offers strong usability within a feature-rich PA/DM portfolio. With sophisticated PA/DM features and thorough integration of wizard-driven automation, KXEN positions its PA/DM tools as key enablers for maximum productivity by data mining specialists and business analysts alike. KXEN utilizes the Sybase IQ In-Database Analytics Option to deliver a robust set of technologies that follow a process that involves collecting data, developing a statistical model, and then making accurate predictions. These advanced technologies are helping 100 s of customers in financial services, communications, healthcare and retail for customer acquisition, retention and churn, and determining the next best activity. MODELING S FIRST-EVER SEMANTIC LAYER Before building a predictive model, the first step is to prepare and transform data into a format that Sybase IQ can process. In the past with other data mining techniques, this took upwards of 40% to 50% of the time spent on any project. To make matters worse, it was repeated every time the predictive model was created. To eliminate this bottleneck, KXEN introduced predictive analytics first-ever semantic layer. It s called InfiniteInsight Explorer, and it s similar to the semantic layer introduced in the early 90 s by business intelligence companies to unblock the reporting bottleneck. ACCURATE MODELS, IN MINUTES, NOT WEEKS A business analyst does not want to worry about complicated math or which algorithm to use. Different models are needed to predict possible business outcomes, or determining which customer likely to churn, or which customer will respond to a cross-sell or up-sell offer. 3

5 Figure 2. In a matter of minutes, InfiniteInsight Modeler can sift through thousands of input variables and present which ones have the most influence on your predictive model. InfiniteInsight Modeler cuts the guesswork out of two major steps in the modeling process: variable creation and variable reduction. And since it s fast and automated, you can include data elements that may not be intuitively obvious at the outset. This translates into more accurate and robust predictive models, especially when your data is changing rapidly. WITH INFINITEINSIGHT, WE VE INCREASED PRODUCTS PER HOUSEHOLD BY 14%. SEYMOUR DOUGLAS, PH.D., EXECUTIVE DIRECTOR ANALYTICS, COX KXEN s patented InfiniteInsight Modeler automates the building of sophisticated predictive models for most every data mining function and includes detailed business and executive summary reports. PUT SCORES INTO ACTION InfiniteInsight was built from the ground up to be deployed in real operational environments ranging from historical data to legacy analytical tools and even local files. And there s no manual processes requiring macros, crazy scripts, data extracts or loading routines. With clicks, not code, InfiniteInsight Scorer can deploy optimized scoring equations right into the Sybase IQ analytics database. FOR USERS, THE SIMPLICITY OF INFINITEINSIGHT IS OF PARTICULAR SIGNIFICANCE. VERENA MEUTHER, MARKETING STRATEGY MARKET & CUSTOMER INSIGHTS, VODAFONE 4

6 EVERY MODEL AT PEAK PERFORMANCE With traditional predictive methods, it s impossible to optimize great numbers of campaigns, because they become overly granular in targeting, or to retrain models on a regular basis. It s simply takes too long and competes with other business priorities. InfiniteInsight Factory has eliminated limits. It s industrialized modeling with a factory approach so that you can build, deploy and improve any number of predictive models. THE SHAPE OF YOUR SOCIAL NETWORK It s no assumption that people socialize into groups. By using business data, we can learn about the links between our customers and just as importantly, which customers have a strong social influence. We can use this insight to create a competitive advantage. THE BENEFITS OF PREDICTIVE ANALYTICS Better understanding of customer behavior propels better decisions Profitable customers can be spotted fast and served accordingly Generate more business by reaching hidden markets Target your marketing message more effectively Helps in minimizing risk and improves ROI Improve profitability by detecting abnormal patterns in sales, claims, and transactions Improved customer service and confidence Significant reduction in direct marketing expenses Figure 3. Social Graphic: Example of a Social Graph depicted through KXEN s InfiniteInsight. Dots represent communities (dense groups) of customers. The bigger the community is, the bigger the size. Communities where groups of customers have an iphone (iphone community) is in red. It is interesting to observe how close are such iphone communities, probably due to a partially viral adoption of the device. Further tests were made to prove that the iphone adoption was correlated at user level and at community level. 5

7 Synthesizing massive amounts of historical data as well as up-to-the-minute live data interactions to determine the next best offer or predictor is a difficult task that companies need to tackle if they want to meet their business objectives, which center around competitive advantage, cost savings, and greater revenues. The right analytics architecture will play a pivotal role in the success of predictive analytics, not only providing them with real-time intelligence, but also helping them to maximize their revenue potential during short windows of opportunities. Sybase IQ and Sybase ESP infuse organizations with fast, flexible access to information. Coupled with KXEN s InfiniteInsight, customers can optimize every step in the customer lifecycle including cross-sell, up-sell, retention and next best activity. For more information, visit and 6

8 To learn more about Sybase IQ please contact your Sybase sales representative or call SYBASE. Sybase, Inc. Worldwide Headquarters One Sybase Drive Dublin, CA U.S.A sybase Copyright 2011 Sybase, Inc. All rights reserved. Unpublished rights reserved under U.S. copyright laws. Sybase and the Sybase logo are trademarks of Sybase, Inc. or its subsidiaries. indicates registration in the United States of America. SAP and the SAP logo are the trademarks or registered trademarks of SAP AG in Germany and in several other countries. All other trademarks are the property of their respective owners. 07/11 iphone is a registered trademark of Apple Inc.