Predictive Technology Drives Evolution of Big Data

Several years ago the Internet revolutionized the way business is done. Now the world finds itself on the precipice of a similar revolution with big data.

Studies show that nearly 90% of professionals believe big data is a game changer for today’s hyper-competitive marketplace. An especially powerful component of this latest revolution is the use of predictive technologies to foresee customer behaviors. This can serve as an essential function for building business strategies and customer relationships.

Predictive analytics for customer engagement is a process that translates huge quantities of data into business insights. One example of this would be to use customers’ purchasing habits to calculate the likelihood of a future outcome. An analysis can include data such as a consumer’s gender, their intent, what he or she has done in the past, what channel he or she uses most and even his or her geographical location. With this information, a company can send targeted coupons on surf lessons to someone who is traveling to San Diego, for example.

Brands competing for consumer attention must be present and ready to engage anywhere their customers choose to stay competitive. The use of big data and predictive analytics is the stepping-stone to doing so. Businesses can expect to glean a range of benefits including marketing efficiency, omnichannel customer experiences and customer loyalty.

Improving marketing efficiency

According to Gartner, companies that focus on customer experience generate 60% higher profits than their competitors. For example, Puma uses personalization and has achieved a 69% increase in revenue per visit, without increasing labor costs.

Big data technologies can revamp companies’ traditional methods of direct mail, email blasts and other communications, by using historical and contextual data to inform the content and offers to be delivered in the future. Such technologies help brands recommend the right type of offers offline or online at the right time – and in the right geographical locations and landing pages – to increase conversions and sales. This type of targeting improves the customer experience, while increasing business revenue.

Delivering an omnichannel customer experience

Accenture Research shows that over the next five years, 63% of organizations believe big data will have the biggest impact on customer relationships. Why is this important? People want to engage with brands and see relevant content. Brands can satisfy this need by delivering a behavior-based experience that is aware of customers’ preferences. According to a 2014 study, 86% of respondents said personalization influences their purchases while 31% wished their shopping experience were more personalized.

Beacon technology is a good example of how retailers can personalize an experience. Special sensors connect with mobile devices and use data from customer activity inside stores to create targeted product recommendations and promotional discounts – just like an in-store associate would. When a shopper enters a store, he or she can opt in to receive information on sales based on a grocery list stored on the device in-hand.

Retailers can also readjust business strategies based on the collection of real-time data. Having experiential engagement beyond the actual product sale is key. Shoe retailer Steve Madden does this well. This company uses predictive analytics to connect customers with the fashion and products they love in a way that is personal, unique and targeted to each individual. As shoppers navigate Steve Madden’s interactive, digital ecosystem, they receive personalized content and offers that appeal to their individual tastes.

Boosting customer loyalty

A personalized customer experience remains the secret to lasting brand loyalty. Greater awareness of consumer preferences results in higher conversion rates, higher average order value and basket sizes, and longer and better customer life cycles. The challenge is to respect consumers’ privacy and deliver a good experience. Shoppers are known to offer more data and information about themselves if it results in a better, richer experience – not just repeated spam.

Leading retailers have two things top of mind these days: Innovating the customer experience to adapt to shifting consumer preferences, and emerging technology capabilities. The retail industry is at a tipping point as customer experience claims a greater influence over retail conversion than any other business process or output. Adopting tools that enable greater closeness and relevance to consumers is imperative, especially as the line between retail brick-and-mortar and e-commerce continues to blur. In the end, it’s about convenience, but also a better experience that gets richer and smarter as a business learns more about its consumers.

Meyer Sheik is the CEO of Certona

 

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