What is behavioral analytics and when is it important?
You’re shopping for a car. You visit a manufacturer’s website to learn about model trims, review deals listed on the local dealer’s website, and then visit the dealership. What information can the sales rep review to learn about your purchasing needs and determine the best options to offer you?
The security operations center receives an alert about an employee’s activities on the network. Is the employee learning about different business areas and just working at unexpected hours from a remote location? Or is this malicious behavior and the SOC should take action?
These are examples of insights that user behavior analytics can provide. Common use cases include increasing business-to-business and business-to-consumer sales, improving customer experience, detecting anomalies, alerting on risks, and leveraging data from Internet of Things devices to identify dangerous conditions.
Rosaria Silipo, principal data scientist and head of evangelism at KNIME, offers this simple definition of behavioral analytics. She says, “Behavioral analytics studies people’s reactions and behavior patterns in particular situations.”
Behavioral analytics is particularly important any time a product or service has many people doing numerous things where there are both opportunities to improve outcomes and to reduce risks. Examples include customer buying habits on large-scale e-commerce websites, healthcare applications, gaming platforms, and wealth management in banking. Silipo explains further, “The goal is to study the mass of people, and the key is the availability of large amounts of data.“
Kathy Brunner, CEO of Acumen Analytics, refers to research that the global behavior analytics market is projected to reach $2.2 billion by 2026, from $427.3 million, at a compound annual growth rate of 32% from 2022 to 2026.
Brunner shares these insights on the business opportunities. “The current focus is mainly retail, and why not? Where I see real transformation is in combining this capability with AI/ML, other advanced modeling technologies, and real-world evidence in healthcare data. Imagine the impact from figuring out how best to get patients into clinical trials, improving drug discovery, and advancing patient outcomes with precision and personalized medicine.”
So although behavioral analytics can be an issue if an implementation violates privacy norms or compliance regulations, it can also lead to very positive outcomes for consumers and businesses.
Behavioral analytics is often used for business opportunities, but the techniques are just as applicable to identify and alert on risks.
