Theresa Fielding owns an Internet company that sells gift baskets. Each customer can pick out what she wants in the basket to make it a personalized gift. Theresa has demographic information about buyers stored in the company database

The database also has the address of each basket recipient, when each basket was sent, the contents of each basket, and if it was sent for a special occasion. How could Theresa use this database?

Theresa has an opportunity to engage in a small-business version of data mining. She could use a data mining program to identify unique patterns of behavior among her different customer groups. Identifying and understanding the habits of her current customers will help Theresa with customer acquisition, or attracting new customers. Data mining could help Theresa increase customer retention and loyalty by identifying the most important customers and then targeting them with special offers and inducements to buy more. Theresa could also use data mining for market basket analysis, using the records of customers who have bought certain products to develop promotional strategies. Finally, Theresa could use data mining to identify unprofitable customers who should be abandoned.