{"id":6066,"date":"2015-06-10T07:24:51","date_gmt":"2015-06-10T01:54:51","guid":{"rendered":"http:\/\/ivyproschool.com\/blog\/?p=6066"},"modified":"2024-11-11T17:08:15","modified_gmt":"2024-11-11T11:38:15","slug":"modelling-techniques-in-predictive-analytics","status":"publish","type":"post","link":"https:\/\/ivyproschool.com\/blog\/modelling-techniques-in-predictive-analytics\/","title":{"rendered":"Modelling Techniques in Predictive Analytics"},"content":{"rendered":"<p>Analytics aims to understand the \u2018why\u2019 if you lose a customer. Predictive analytics moves beyond this to prevent you from losing a customer <strong>before <\/strong>it happens.<\/p>\n<p style=\"text-align: left;\">Predictive analytics supports insight, not hindsight. You discover meaningful trends and patterns in the data, and make predictions of unknown future outcomes. Using real world models that leverage\u00a0mathematical and\/or statistical techniques, you can predict possible events with a fair degree of accuracy.<\/p>\n<p><a href=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-analytics.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-6080\" src=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-analytics.png\" alt=\"Predictive analytics\" width=\"580\" height=\"348\" srcset=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-analytics.png 580w, https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-analytics-300x180.png 300w\" sizes=\"auto, (max-width: 580px) 100vw, 580px\" \/><\/a><\/p>\n<p>Models, in predictive analytics, represent meaningful relationships among variables, response or explanatory variables. <em>Response variable<\/em> refers to the quantity about which a query is made, while <em>explanatory variable <\/em>is the factor influencing the response variable. Explanatory variables are useful in predictive models &#8211; for observation, manipulation and control in relation to response.\u00a0Patterns in historical and transactional data are studied for such variables to draw conclusions and make\u00a0forecasts or\u00a0identify opportunities.<\/p>\n<p><strong>Predictive Modeling<\/strong><\/p>\n<p>Predictive modeling is the creating, testing, validating and evaluating of a model to predict an outcome with a given input data.<\/p>\n<p>A predictive model has <em>predictors<\/em>, i.e. variables likely to influence future outcomes. For instance, the gender, age group, location and purchase history of a customer adds up to the probability of a repeat transaction. These are &#8216;<em>predictors<\/em>&#8216;.<\/p>\n<p><a href=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-modelling.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-6081\" src=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-modelling.png\" alt=\"Predictive modelling\" width=\"591\" height=\"343\" srcset=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-modelling.png 591w, https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-modelling-300x174.png 300w\" sizes=\"auto, (max-width: 591px) 100vw, 591px\" \/><\/a><\/p>\n<p><strong>What does a Predictive model do?<\/strong><\/p>\n<ul>\n<li>represents relationships in historical or\/and real-time data<\/li>\n<li>looks for useful predictors or explanatory variables in the given data set<\/li>\n<li>fits models to subsets of data for evaluation of each predictor<\/li>\n<li>makes observations, forecasts, classifications, predictions about future events.<\/li>\n<li>assigns metrics for future actions<\/li>\n<\/ul>\n<p><strong>Approaches of Predictive Modelling<\/strong><\/p>\n<ol>\n<li><strong>Traditional \u2013 <\/strong>driven by theories<strong>; <\/strong>uses classical or Bayesian methods of statistical inference; estimates parameters for linear predictors<\/li>\n<li><strong>Data-adaptive<\/strong> \u2013 driven by data; searches the data for subsets of useful predictors using machine learning methods; establishes non-linear relationships and interactions among variables<\/li>\n<li><strong>Model dependent <\/strong>\u2013 driven by specific model; uses the model\/simulations to generate data, predictions or make recommendations; generated data is further compared with real data<\/li>\n<\/ol>\n<p><strong>Common predictive models <\/strong>are <strong>regression<\/strong> and <strong>classification<\/strong>.<\/p>\n<p><a href=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-modelling-types.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-6082\" src=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-modelling-types.png\" alt=\"Predictive modelling types\" width=\"594\" height=\"351\" srcset=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-modelling-types.png 594w, https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-modelling-types-300x177.png 300w\" sizes=\"auto, (max-width: 594px) 100vw, 594px\" \/><\/a><\/p>\n<p>Look out for our next post on \u00a0&#8220;<strong>Common Statistical techniques used in Predictive modelling&#8221;.<\/strong><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Predictive Analytics uses various techniques to make observations, forecasts, and predictions about future outcomes. The most commonly used method to make predictions is Prediction Modelling, based on relationships and dependencies of predictors, from given historical and real-time data.<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[551],"tags":[664,677,140,291,679,663,678],"class_list":["post-6066","post","type-post","status-publish","format-standard","hentry","category-tools-softwares","tag-classification-modelling","tag-explanatory-variable","tag-predictive-analytics","tag-predictive-modelling","tag-predictors","tag-regression-modelling","tag-response-variable"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Predictive Analytics: Techniques to Anticipate Future Outcomes<\/title>\n<meta name=\"description\" content=\"Learn predictive analytics modeling techniques that reveal trends, forecast events, and help prevent customer churn by identifying critical predictors.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ivyproschool.com\/blog\/modelling-techniques-in-predictive-analytics\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Predictive Analytics: Techniques to Anticipate Future Outcomes\" \/>\n<meta property=\"og:description\" content=\"Learn predictive analytics modeling techniques that reveal trends, forecast events, and help prevent customer churn by identifying critical predictors.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/ivyproschool.com\/blog\/modelling-techniques-in-predictive-analytics\/\" \/>\n<meta property=\"og:site_name\" content=\"R vs Python: Which Analytics Tool Should You Choose for Data Science?\" \/>\n<meta property=\"article:author\" content=\"https:\/\/facebook.com\/ivyproschool\" \/>\n<meta property=\"article:published_time\" content=\"2015-06-10T01:54:51+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-11-11T11:38:15+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/ivyproschool.com\/blog\/wp-content\/uploads\/2015\/06\/Predictive-analytics.png\" \/>\n<meta name=\"author\" content=\"Ivy Professional School\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@ivyproschool\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Ivy Professional School\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/ivyproschool.com\\\/blog\\\/modelling-techniques-in-predictive-analytics\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/ivyproschool.com\\\/blog\\\/modelling-techniques-in-predictive-analytics\\\/\"},\"author\":{\"name\":\"Ivy Professional School\",\"@id\":\"https:\\\/\\\/ivyproschool.com\\\/blog\\\/#\\\/schema\\\/person\\\/31fdab8559dd3db99173764bfb60215d\"},\"headline\":\"Modelling Techniques in Predictive Analytics\",\"datePublished\":\"2015-06-10T01:54:51+00:00\",\"dateModified\":\"2024-11-11T11:38:15+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/ivyproschool.com\\\/blog\\\/modelling-techniques-in-predictive-analytics\\\/\"},\"wordCount\":349,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/ivyproschool.com\\\/blog\\\/modelling-techniques-in-predictive-analytics\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/ivyproschool.com\\\/blog\\\/wp-content\\\/uploads\\\/2015\\\/06\\\/Predictive-analytics.png\",\"keywords\":[\"classification modelling\",\"explanatory variable\",\"predictive analytics\",\"predictive modelling\",\"predictors\",\"regression modelling\",\"response variable\"],\"articleSection\":[\"Tools &amp; 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