Deciphering data: Student learns tools to help businesses analyze customer buys

Hayley Ferguson, a senior in management information systems, uses technology tools to learn how to help businesses succeed. Credit: Tom FlachAll Rights Reserved.

When you're stacking your grocery items at the checkout line, you're probably not thinking about whether your supermarket chain is compiling and storing a profile of you based on what you buy. After all, no one but your finicky family members care whether you buy one brand of laundry detergent over another, or purchase frozen pizza with that family-sized bag of BBQ chips, right?Wrong. Supermarkets care, too. So much so that they use “loyalty” cards to keep tabs on what you purchase and how often you shop. All of this data helps them predict your buying preferences and stay competitive in the retail food market.

Kathleen Riley, an instructor of management information systems (MIS) in the Smeal College of Business, said this type of customer analysis is a simple example of data mining known as market-basket analysis — a technique used to determine if there are combinations of products frequently bought together. “A retailer can use this information to make business decisions and determine store layout and product placement by putting companion products close to one another on the shelf,” said Riley.Online retailers and publishers can also use market-basket analysis to designate the placement of products in their catalogs and drive such recommendation engines as Amazon’s “customers who bought this product also bought these products” notices to target customers who are most likely to buy from them.In today’s digital world, many companies are using a variety of social, mobile, analytic and cloud (SMAC) technology tools to strategically analyze every step of the customer's journey and stay competitive. As a result, they are inundated with data. With so much data it can be difficult for companies to know what to look for or where to start. And that’s where MIS professionals are needed.“Today’s MIS students grew up using such SMAC technology as Facebook, Snapchat, LinkedIn and Twitter, and they know how to use these platforms and applications better than a lot of businesses do,” said Riley. As a result, they’re already comfortable with technology and are more knowledgeable about how it can be used for data collection and analysis.Hayley Ferguson, a senior in MIS, understands good business decision making should be supported by data and facts. As a result, Ferguson is studying technology-supported techniques for exploring, analyzing, integrating and reporting business data to learn how to help companies make real-time, fact-based decisions.One of the techniques Ferguson uses is Systems, Applications and Products (SAP) in data processing — a software program used for managing business operations.“With SAP, every portion of the business — from accounting, procurement, marketing, sales and logistics — is working from the same set of master data,” said Ferguson. As a result, everyone in the company has the same information at the same time to make decisions. “The software helps keep everyone on board and working together so the business doesn’t have the sales group thinking there’s one thing going on, while the logistics group is processing a purchase order the sales team doesn’t even know about.” To grasp how individual parts of a business impact the entire organization, Ferguson has also been using a registered business simulation platform to practice and hone her business management skills. The interactive platform enables her to test assumptions about such business aspects as accounts receivable, inventory and other supply chain practices and learn how they each interact with data.

“By using the simulation platform, I get the chance to apply what I’ve learned in MIS across such disciplines as research and development, marketing, production and finance to determine the usefulness of the data and to ensure a company will be able to use the data to make better business decisions,” said Ferguson.Checking for the usefulness of the data isn’t the only important aspect for an MIS professional to know.

“The presentation and visualization of the data is just as important to make sure company decision makers can easily understand and use the results,” said Riley.MIS professionals can create custom data dashboards to allow a business to interact with and understand its data analysis. The dashboard, which resembles an automobile dashboard, displays key performance indicators for a business by integrating information important to that organization.

“Whether it’s to get a quick check on the total number of sales in a particular region or to see what particular products are doing well in the marketplace, the dashboard places the information into a unified visual display,” said Riley. The end result is a set of tables, charts and graphs that provide a user-friendly visual.“Dashboards are meant to be as informative as possible. They enable users to hover over something to get a little more explanation or click on a date range to drill down on customer ordering details,” said Ferguson. “They provide a one-stop visual shop for reading and deciphering a business’s important data information.”While collecting and analyzing customer data is important for making informed business decisions, Riley makes sure her students are informed about privacy and security issues surrounding the process of collecting data through technology-based tracking tools.

“We spend time talking, at a conceptual level, about privacy and security from a business standpoint,” said Riley.Even though privacy and security are important aspects to consider, Riley said the use of technology-based tracking tools is the way things are progressing in the business world.

“In order to make better fact-based business decisions, companies need to have data; they need to know what people are searching for on Google as well as what they’re saying about their product on such places as Facebook, blogs and Amazon online reviews,” she said.Ferguson agrees.

“It’s all about companies having the freedom to gather information to help them hone in on their customers and understand them so they can have great commercial success,” she said.For more IT stories at Penn State, visit

Businesses use data from customer loyalty cards to keep track of purchases and predict buying preferences. Credit: Flickr user Chris KennedyAll Rights Reserved.

Last Updated April 14, 2015