Data Mining:

— Chapter 1 —
Overview

June 6, 2023 Data Mining: Overview 1

 Brodsky, 2013
June 6, 2023 Data Mining: Concepts and Techniques 2
 Chapter 1. Introduction

 Motivation: Why data mining?

 What is data mining?
 Data Mining: On what kind of data?
 Data mining functionality
 Classification of data mining systems
 Major issues in data mining
 Overview of the course

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 Why Data Mining?

 The Explosive Growth of Data: from terabytes to petabytes

 Data collection and data availability
 Automated data collection tools, database systems, Web,
computerized society
 Major sources of abundant data
 Business: Web, e-commerce, transactions, stocks, …
 Science: Remote sensing, bioinformatics, scientific simulation, …
 Society and everyone: news, digital cameras, YouTube
 We are drowning in data, but starving for knowledge!
 “Necessity is the mother of invention”—Data mining—Automated
analysis of massive data sets

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 What Is Data Mining?

 Data mining (knowledge discovery from data)

 Extraction of interesting (non-trivial, implicit, previously
unknown and potentially useful) patterns or knowledge from
huge amount of data
 Data mining: a misnomer?
 Alternative names
 Knowledge discovery (mining) in databases (KDD), knowledge
extraction, data/pattern analysis, data archeology, data
dredging, information harvesting, business intelligence, etc.

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 Knowledge Discovery (KDD) Process

 Data mining—core of Pattern Evaluation

knowledge discovery
process
Data Mining

Task-relevant Data

Data Selection
Warehouse
Data Cleaning

Data Integration

Databases
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 Data Mining and Business Intelligence

Increasing potential Ex: Cancer research

to support
business decisions End User
Decision
Making

Data Presentation Business

Analyst
Visualization Techniques
Data Mining Data
Information Discovery Analyst

Data Exploration
Statistical Summary, Querying, and Reporting

Data Preprocessing/Integration, Data Warehouses

DBA
Data Sources
Paper, Files, Web documents, Scientific experiments, Database Systems
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 Data Mining: Confluence of Multiple Disciplines

Database
Technology Statistics

Machine Visualization
Learning Data Mining

Pattern
Recognition Other
Algorithm Disciplines

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 Why Not Traditional Data Analysis?
 Tremendous amount of data
 Algorithms must be highly scalable to handle such as tera-bytes of
data
 High-dimensionality of data
 Micro-array may have tens of thousands of dimensions
 High complexity of data
 Data streams and sensor data
 Time-series data, temporal data, sequence data
 Structure data, graphs, social networks and multi-linked data
 Heterogeneous databases and legacy databases
 multimedia, text and Web data
 Software programs, scientific simulations
 New and sophisticated applications
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 3V of Big Data

http://www.datasciencecentral.com/forum/topics/the-3vs-that-
define-big-data
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 Multi-Dimensional View of Data Mining
 Data to be mined
 Relational, data warehouse, transactional, stream,
object-oriented/relational, active, spatial, time-series, text, multi-media,
heterogeneous, legacy, WWW
 Knowledge to be mined
 Characterization, association, classification, clustering, trend/deviation,
outlier analysis, etc.
 Techniques utilized
 Database-oriented, data warehouse (OLAP), machine learning, statistics,
visualization, etc.
 Applications adapted
 Retail, telecommunication, banking, fraud analysis, bio-data mining, stock
market analysis, text mining, Web mining, etc.

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 Data Mining: Classification Schemes

 General functionality
 Descriptive data mining (Democrat <-> Republican)
 Predictive data mining
 Different views lead to different classifications
 Data view: Kinds of data to be mined
 Knowledge view: Kinds of knowledge to be discovered
 Method view: Kinds of techniques utilized
 Application view: Kinds of applications adapted

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 Data Mining: On What Kinds of Data?
 Database-oriented data sets and applications
 Relational database, data warehouse, transactional database
 Advanced data sets and advanced applications
 Data streams and sensor data
 Time-series data, temporal data
 Structure data, graphs, social networks and multi-linked data
 Heterogeneous databases and legacy databases
 Multimedia database
 Text databases
 The World-Wide Web

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 Data Mining Functionalities
 Multidimensional concept description: Characterization and discrimination
 Generalize, summarize, and contrast data characteristics, e.g., human
and monkey?
 Good income VS poor?
 Frequent patterns, association, correlation
Diaper  Beer [0.5%, 75%], Education -> Income
 Classification and prediction
 Construct models (functions) that describe and distinguish classes or
concepts for future prediction
 E.g., classify countries based on (economy), cars based on (gas
mileage), internet news (Google News), product (Amazon)
 Predict some stock price, traffic jam

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 Data Mining Functionalities (2)
 Cluster analysis
 Class label is unknown: Group data to form new classes, e.g., cluster

houses to find distribution patterns, terrain images?

 Maximizing intra-cluster similarity & minimizing inter cluster similarity

 Outlier analysis
 Outlier: Data object that does not comply with the general behavior

of the data
 Noise or exception? Useful in fraud detection, rare events analysis

 Trend and evolution analysis

 Trend and deviation: e.g., political polls? Who will win republican

nomination in 2023? Who will win presidential election?

 Sequential pattern mining: e.g., video mining -> identify objects

 Periodicity analysis: climate change?

 Similarity-based analysis: future of the Apple company?

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 Top-10 Algorithm Finally Selected at
ICDM’06
 #1: C4.5 (61 votes)
 #2: K-Means (60 votes)
 #3: SVM (58 votes)
 #4: Apriori (52 votes)
 #5: EM (48 votes)
 #6: PageRank (46 votes)
 #7: AdaBoost (45 votes)
 #7: kNN (45 votes)
 #7: Naive Bayes (45 votes)
 #10: CART (34 votes)

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 Major Issues in Data Mining
 Mining methodology
 Mining different kinds of knowledge from diverse data types, e.g., bio, stream,
Web
 Performance: efficiency, effectiveness, and scalability
 Pattern evaluation: the interestingness problem
 Incorporation of background knowledge
 Handling noise and incomplete data
 Integration of the discovered knowledge with existing one: knowledge fusion
 User interaction
 Data mining query languages and ad-hoc mining
 Expression and visualization of data mining results
 Applications and social impacts
 Protection of data security, integrity, and privacy

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 Architecture: Typical Data Mining System

Graphical User Interface

Pattern Evaluation
Knowl
Data Mining Engine edge-
Base
Database or Data
Warehouse Server

data cleaning, integration, and selection

Data World-Wide Other Info

Database Repositories
Warehouse Web

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 Summary

 Data mining: Discovering interesting patterns from large amounts of

data
 A natural evolution of database technology and machine learning, in
great demand, with wide applications
 A KDD process includes data cleaning, data integration, data
selection, transformation, data mining, pattern evaluation, and
knowledge presentation
 Mining can be performed in a variety of information repositories
 Data mining functionalities: characterization, discrimination,
association, classification, clustering, outlier and trend analysis, etc.
 Data mining systems and architectures
 Major issues in data mining

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 Why Data Mining?—Potential Applications

 Data analysis and decision support

 Market analysis and management
 Target marketing, customer relationship management (CRM),
market basket analysis, market segmentation
 Risk analysis and management
 Forecasting, customer retention, improved underwriting,
quality control, competitive analysis
 Fraud detection and detection of unusual patterns (outliers)
 Other Applications
 Text mining (news group, email, documents) and Web mining
 Stream data mining
 Bioinformatics and bio-data analysis

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 Ex. 1: Market Analysis and Management
 Where does the data come from?—Credit card transactions, loyalty cards,
discount coupons, customer complaint calls, plus (public) lifestyle studies
 Target marketing
 Find clusters of “model” customers who share the same characteristics: interest,
income level, spending habits, etc.
 Determine customer purchasing patterns over time
 Cross-market analysis—Find associations/co-relations between product sales, &
predict based on such association
 Customer profiling—What types of customers buy what products (clustering or
classification)
 Customer requirement analysis
 Identify the best products for different groups of customers
 Predict what factors will attract new customers
 Provision of summary information
 Multidimensional summary reports
 Statistical summary information (data central tendency and variation)

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 Ex. 2: Corporate Analysis & Risk Management

 Finance planning and asset evaluation

 cash flow analysis and prediction
 contingent claim analysis to evaluate assets
 cross-sectional and time series analysis (financial-ratio, trend
analysis, etc.)
 Resource planning
 summarize and compare the resources and spending
 Competition
 monitor competitors and market directions
 group customers into classes and a class-based pricing procedure
 set pricing strategy in a highly competitive market

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 Ex. 3: Fraud Detection & Mining Unusual Patterns

 Approaches: Clustering & model construction for frauds, outlier analysis

 Applications: Health care, retail, credit card service, telecomm.
 Auto insurance: ring of collisions
 Money laundering: suspicious monetary transactions
 Medical insurance
 Professional patients, ring of doctors, and ring of references
 Unnecessary or correlated screening tests
 Telecommunications: phone-call fraud
 Phone call model: destination of the call, duration, time of day or
week. Analyze patterns that deviate from an expected norm
 Retail industry
 Analysts estimate that 38% of retail shrink is due to dishonest
employees
 Anti-terrorism

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