The era of big data has reached a point where “big” is no longer adequate to describe the amount of information flowing between channels. Every second, people perform more than 55,000 Google searches, send 2.5 million emails, exchange 521,000 Facebook messages and share 6,000 tweets.
At the same time, customers are making purchases from your website or browsing your brick-and-mortar store for just the right products to meet their needs. Each message, online shopping session and store visit contains valuable data you need to reach your ideal customer and maximize marketing and sales efforts.
How do you transform shopping behaviors, search histories and social signals into information allowing you to make the most of every channel you use to communicate with customers?
Forty-five percent of retailers don’t use data effectively in their marketing, and 42 percent haven’t even invested in the tools they need to make connections between different types of customer data.
However, when you have a comprehensive data analytics platform in place, the signals customers send with their behaviors begin to make sense, and you can apply what you learn in several practical ways.
Know Your Perfect Customer
The days the blindly conceived, static and unchanging customer personas are long gone. With the amount of data available about your customers, you no longer have to guess who they are, what they want or how their spending habits change over time. Today’s data analytics platforms allow you to look at data and determine:
• Age and gender
• Demographics, including income
• Spending habits
• Purchasing patterns
• Payment preferences
• The most popular devices used for shopping
• The most common times people shop
Using these data points, it’s possible to build a 360-degree view of your customers from the moment they start researching a product to the time they receive it and begin using it. You can even determine some of the details of a customer’s life by tracking what they buy and when, thereby creating a detailed image of your ideal target market.
Apply the information you gather and the behavior patterns you observe to:
• Create granular audience segments
• Build out targeted marketing campaigns
• Tweak marketing and sales tactics in real time
Data relating to consumer preferences can act as a powerful tool for executing personalized shopping experiences. As the millennial generation continues to dominate the market and Generation Z begins to exert influence, personalization is becoming the cornerstone of successful sales.
Consumers are used to being catered to and seeing product, service and entertainment recommendations relevant to their tastes and preferences. Eighty percent of customers prefer to buy from brands making an effort to provide personalized experiences, so if you’re still using generic messaging to try and sell to a wide audience of varied consumers, you’re missing out on one of the most effective tactics in modern marketing.
Analyze the enormous amount of data you have on hand to discover:
• Which items customers purchase most often
• Items frequently bought together
• How customers search your site
• The most common product searches
• Seasonal buying habits
Your analysis can be translated into practical marketing tactics like customized recommendations and coupons delivered at the most optimal times to maximize the potential for sales.
Create the Best Pricing Model
Every business owner knows the pain of purchasing a large amount of inventory in anticipation of a rush on a supposedly hot item but winding up taking a big loss when a competitor offers a better deal. With detailed data analytics, you don’t have to guess how to price items to drive sales and move inventory.
Big data tools now offer ways to visualize the effects of different pricing models on demand, allowing you to anticipate how even small increases or decreases in price will change your profit margins. Instead of getting into price wars with your competitors, you can base your prices on what you know about how your customers shop, what they’re willing to pay for similar items and how purchasing behaviors in your target demographic fluctuate throughout the year.
You can also track the items customers look at most often but don’t buy to determine if price may be the factor holding them back from converting. By narrowing down pricing decisions to specific items instead of categories, you can adopt a dynamic pricing model and adjust what you charge to match real-time changes in demand as revealed by data analytics.
Maximize the Impact of All Channels
How many different channels are you using to reach your customers with marketing messages?
If your business is like most, you’re probably trying to leverage a wide range of platforms, including:
• Organic social media
• Social media advertising
• Pay-per-click (PPC) ads
• Direct mail
• Print ads
Data from these various channels comes in at different rates, but all of it is important in determining how to allocate your marketing budget. The trick to effective marketing using what you learn from data is to balance short- and long-term strategies based on past campaign performance.
By incorporating social signals and using tools like Facebook’s Audience Insights and Google’s Keyword Planner, you can craft campaigns to deliver relevant content to specific customers at the right times and minimize the amount of money wasted on unsuccessful tactics.
Modern data analytics has the added bonus of being predictive, so you can look at the whole picture of your target audience alongside output from campaigns to determine if new marketing and sales ideas are likely to generate enough revenue to be worthwhile.
Transform the Physical Shopping Experience
Data is so big now, it isn’t limited to online channels and e-commerce.
Many brick-and-mortar retailers are now using:
• Dedicated apps to improve the in-store shopping experience
• Beacons and location-based analytics to determine the areas of the store in which customers spend the most time
• Purchase tracking online and in store for a more robust view of customer shopping behaviors
• Personalized loyalty programs to deliver targeted coupons and discounts
• Information about customer preferences to inform inventory purchasing decisions and ensure popular items are always in stock.
This creates more touchpoints between retailers and customers, and it increases the number of sources from which customer information can be gleaned. By adopting these tactics in your own store, you can streamline both the in-store and online shopping experiences with relevant product recommendations, customized sales offers and personalized service.
The Bottom Line for Data
Applying big data in these ways requires the right analytics tools and a dedicated team of data experts to extract useful signals from the constant noise generated by today’s connected world. To optimally leverage data for your business, it helps to appoint a chief data officer to oversee your team and focus on how to turn customer behavior signals into measurable results.
Know what you want to achieve using the data you collect so that you always have a focus for your marketing and sales efforts. Being willing to invest time and effort into data-driven campaigns increase your chances of rising above the competition and reaching the largest audience of ideal customers.
Your customers give you more information every day, so dig into the goldmine of what you already have to maximize your campaigns and grow your business in targeted, meaningful ways.