Unlabeled data: What is it and why does it matter for businesses?

Unlabeled data: What is it and why does it matter for businesses?


The sheer volume of data being created daily is staggering. According to IBM, 2.5 quintillion bytes of data are created every day. That’s the equivalent of 250,000 Libraries of Congress! And it’s only going to increase as we move further into the digital age. Most of this data is unstructured and unlabeled.

Unlabeled data is data that has not been given a specific category i.e., it does not have any identifying information attached to it. It is just a list of numbers, or a collection of objects without any associated metadata. It can be found in many places, including online forums, social media sites, and customer feedback surveys. Therefore, it is raw data that has not been annotated by humans.  

Labeled data is "tagged" with information that identifies it. For example, in a database of people's names, the column headings might be "first name", "last name", "age", etc. Labeled data can come from a variety of sources, including surveys, censuses, and social media posts. It can be used to target advertising, conduct research, and more.

Modelling using Unlabeled Data

Modelling is the process of creating a mathematical or statistical model of a real-world system. The purpose of modelling is to understand the behavior of the system, and to identify improvements. Modelling can be used to predict future events, or to test hypotheses about how the system works.

Most modelling is done using data that has been labelled, meaning that each data point has been given a name or a number that identifies it uniquely. However, there is also a lot of modelling that uses unlabeled data.  

There are a few advantages to working with unlabeled data.  

First, it is much more plentiful than labeled data. The vast majority of the world’s data is unlabeled, and most of it is never used because it is so difficult to find and sort through. But with the right tools, unlabeled data can be converted into valuable insights.

Second, unlabeled data is often more accurate than labeled data. Because it has not been filtered or selected in any way, it contains a greater variety of information and is less likely to be biased. This makes it a valuable resource for machine learning and other artificial intelligence applications.

As such, it should be used whenever possible to create a realistic model.

There are two main methods of using unlabeled data: unsupervised learning and semi-supervised learning. In unsupervised learning, the model is trained using only unlabeled data. In semi-supervised learning, a small amount of labeled data is used to help train the model, with most of the training done using unlabeled data. Let us have a detailed look on both methods.

Unsupervised Learning

Unsupervised machine learning is a process of learning from unlabeled data. This type of learning is used when there is no teacher to guide the learner, and it is often employed in cases where the amount of data available exceeds the capacity of human beings to label it by hand. In unsupervised learning, algorithms are used to find patterns in data, and these patterns are then used to predict future events or outcomes.

There are several different methods of unsupervised learning, each of which has its own strengths and weaknesses.


In clustering, the data is divided into groups (or clusters) based on similarities between the data points. This can be useful for discovering patterns in unlabeled data, or for finding groupings in data that has already been labeled.

There are several diverse types of clustering algorithms, but all of them attempt to find natural groupings in the data. For example, a clustering algorithm might divide a set of photos into categories based on the objects in the photos, or the locations where they were taken.

There are many clustering algorithms, and they can be divided into two categories: hierarchical and k-means.

Hierarchical clustering starts with a particular group and then subdivides it into smaller groups, while partitional clustering starts with multiple groups and merges them together until there is only one group. Hierarchical clustering is more commonly used because it produces interpretable clusters, meaning that the user can understand the structure of the data.

K-means is a simple algorithm that can be used to cluster data into a fixed number of clusters. The algorithm starts by randomly selecting a number of cluster centers, or "k" clusters. The data is then partitioned into these k clusters, and the center of each cluster is calculated. The algorithm then iterates over the data, assigning each point to the closest cluster center.

One advantage of k-means clustering is that it is relatively fast and easy to implement. It also produces interpretable results, meaning that the clusters are easy to understand. However, k-means clustering can be sensitive to initialization, meaning that the results can vary depending on which cluster centers are chosen.

Dimensionality Reduction

Dimensionality reduction is a type of unsupervised learning algorithm that reduces the number of dimensions in a dataset. This can be useful for reducing the complexity of data and making it easier to understand.  

There are a number of different dimensionality reduction algorithms, each with its own strengths and weaknesses. Some examples of unsupervised learning algorithms include principal component analysis (PCA) and t-distributed stochastic neighbor embedding (t-SNE).

PCA is a technique that can be used to identify and extract the principal components of a dataset. These components are the dimensions that account for the most variation in the data. Once the principal components have been identified, the original dataset can be reconstructed by combining the scores on the components.

t-SNE is a technique that can be used to reduce the dimensionality of data by projecting it into a lower-dimensional space. The algorithm attempts to find a space where points are as close as possible to their neighbors, while still preserving the overall structure of the data. This can be useful for visualization purposes, or for finding patterns in high-dimensional data sets.

Semi-Supervised Learning

Semi-supervised learning (SSL) is a type of machine learning algorithm that uses both labeled and unlabeled data to improve the accuracy of predictions. SSL is particularly useful for problems where labeling data is difficult or expensive, such as image recognition or natural language processing.

One common approach to SSL is to first train a model using only the labeled data. Once the model is trained, it can be used to predict the labels of unlabeled data. The predicted labels can then be used to improve the model's accuracy. This process can be repeated until the model reaches a desired level of accuracy.

SSL can also be used to learn a representation of the data that is independent of the labels. This can be useful for tasks such as text classification, where the task is to determine the category of a document, but the category labels are not known in advance.
Data Block


In business, data is key. The more data you have, the better your chances of making accurate predictions and decisions. However, not all data is created equal - some is more valuable than others.

Companies like Tooliqa are constructing robust solutions for businesses which delve deeper into difficult data to identify great opportunities and deliver precise solutioning.

Businesses can use modelling with unlabeled data to predict consumer behavior, forecast sales trends, and identify potential risks and opportunities. It can also be used to improve decision-making processes by providing insights into how different variables interact with each other.

The benefits of modelling are clear - businesses that use modelling techniques are more likely to succeed than those that do not. By taking advantage of unlabeled data, businesses can obtain a competitive edge and improve their bottom line.

Learn more on how your business can leverage Tooliqa's Data Driven Intelligence solutions to automate processes so that you can focus on your core.

Contact our experts at: business@tooli.qa

Also read: Small Data In Machine Learning- Importance, Applications And Scope (tooli.qa)


Quick queries for this insight

How can businesses benefit from using unlabeled data?
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Unlabeled data is often seen as a liability for businesses, but it can actually be a valuable resource. By harnessing the power of unlabeled data, businesses can gain insights that they would not have otherwise been able to obtain.

Why is unlabeled data difficult to model?
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Unlabeled data is difficult to model because it does not have a pre-determined structure. This means that it is more challenging to identify patterns and relationships in the data, which is essential for creating predictive models. Furthermore, unlabeled data is less likely to be accurately represented in statistical models. As a result, businesses must take extra care when using unlabeled data for modeling purposes. By understanding the challenges associated with working with unlabeled data, businesses can take steps to ensure that their models are as accurate as possible.

What is the difference between Clustering and Dimensionality Reduction?
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Both clustering and dimensionality reduction are methods classified under Unsupervised Learning. Clustering is used to find categories with properly defined similarity/distance between each pair of data points. Dimensionality reduction is used to simplify data points by reducing the redundancy in them.

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