Data has become a major priority for business of all sizes, that are focused on continuous improvement and growth. Data can be used for better understanding of day-to-day operations, making evidence based business decisions and learning more about their customers and potential customers. And the more you know about the factors affecting your business, the more you can improve and grow your business.
Collecting customer data is the single most important key to understanding your current customers and creating effective marketing strategies to target new customers. Without data, you’re making decisions blindly, hoping to reach your targets based on gut decisions or even worse, ideas that have worked previously. Why base your marketing on what you think customers want when you could give them exactly what they want?
From consumer behavior to predictive analytics, companies regularly capture, store and analyze large amounts of data on their consumer base every day. Some companies have even built an entire business model around consumer data, whether they create targeted ads or sell to a third party. Customer data is big business, so much so that if I tell you that there are big companies out there, whose names you are yet to hear, but they know you very well and have been building up a profile of you over a very long time.
Here’s a look at some of the ways companies capture their customers’ data, what exactly they do with that information, and how you can use the same techniques to improve your business. Customer data can be collected in three main ways – by directly asking customers, by indirectly tracking customers, and by appending other sources of customer data to your own.
Directly asking the customer
Customer data collection might seem counter-intuitive in an era where privacy is a major issue. The truth is, customers crave personalization when it comes to interaction and marketing. According to this study, 65% of customers were happy to share their information in exchange for more targeted marketing. Almost 67% were willing to share their data if they receive some form of benefit, such as discounts. When customers are willing to provide personal data for marketing purposes, why not collect it and use it for more targeted, strategic marketing?
You can collect customer data via loyalty cards or systems, which is an easy way to get customers to give you their information and accurately track individual buying habits. Over time, the data you hold will detail the preferences of individual customers, what kinds of promotions they are likely to respond to, even what days they prefer to shop. An email marketing list is kind of like a loyalty system and should be a first step if you can not impletment a full program, this will give you the ability to track what offers your customers are interested in and what they are not, even data about not clicking through through to a product or topic provides more details to refine your offer.
If you need more in depth details from your customers or potential customers, why not create an online survey? This way you can ask more questions plus group it with demographic data (gather gender, age and income; you might be surprised at who is actually buying what) to get a better understanding of your customers. What your customers loved five years ago isn’t what they want today. If you’re using data collected years ago, you’re going to be out of touch with your customers today.
Indirectly tracking customers
Cookies, we have all seen this word in our browser settings, but what does it actually mean? Cookies help companies track visitors, delineate between multiple page views and single visits, personalize landing pages and allow users to stay logged in. This means that you can thank cookies for not having to reset password on a daily basis! However it allows a company to collecting information from you, when most of the time, you don’t even realize that they are. They may be storing your location, activity, patterns, preferences, demographics and other information to your profile on a daily basis.
Apart from the most obvious places (website cookies) there are some more interesting methods at work as well. Companies will also dig deep into their own customer service records to see how customers have interacted with their sales, support and marketing departments in the past. Here, they are incorporating direct feedback about what worked and what didn’t, what a customer liked and disliked, on a grand scale. Sucessfull businesses are adept at pulling in data from nearly every interaction, regauardless if you interacted or not.
Other sources of customer data
In addition to collecting data, companies can also purchase it from or sell it to third-party sources. Once captured, this information is regularly changing hands in a data marketplace of its own.
Digital marketing platforms allow you to target specific audiences that look like your customers for a small premium, whilst you may not be buying the data directly, you are renting the right to target the right individual with the right message and potentiall get a lower cost per conversion compared to not paying the premium and targeting the right people.
Turning data into knowledge
You likely already have numerous data sources and all that’s left to do is bring them all together. After all, data collection is all just preparation for analysis. And once you crunch the numbers? You use that data to build out a strategy and a website that speaks directly to your customers in the way they want to be spoken to.
Capturing large amounts of data creates the problem of how to sort through and analyze all that data. No human can reasonably sit down and read through line after line of customer data all day long, and even if they could, they probably wouldn’t make much of a dent or find any great insights. As machine learning algorithms and other forms of AI proliferate and improve, data analytics becomes an even more powerful field for breaking down the sea of data into manageable tidbits of actionable insights. Some AI programs will flag anomalies or offer recommendations to decision-makers within an organization based on the contextualized data. Without programs like these, all the data capture in the world would be utterly useless.
It’s 6-7 times more expensive to gain new customers than retain existing ones. To stay in touch, you need to constantly collect data to continue marketing to your existing customers and by sending the right messages to your current customers, it will mean more happy customers and lead to them spending more money.
Here at MyNext we have years of experience capturing and using consumer data, working with people just like you, with defined business goals to create the perfect solution. Feel free to contact us if you want anymore information or think we may be the team to work with you.