5 Ways Big Data Improves Customer Retention
A lot has been said about Big Data’s potential to affect the way marketing is done. One question that hasn’t been getting a lot of press, however, is how Big Data can help improve customer retention. In such a volatile market where the consumer is king, keeping consumers loyal to a brand is difficult. One bad experience, a change in price, or a new, colorful brand can send consumers off in another direction without a glance back. Some companies have implemented platforms like Apache Hadoop that can access more data faster as a solution to their customer retention woes. Here’s five reasons why.
1. Reach Out to Customers First
Through predictive analytics, Big Data is able to predict which consumers may be experiencing issues with a product or service, so the company can contact them before they have to call a customer service line. This provides several advantages to the company as the service representative will have a good idea of what the issue is before contacting the customer, so they can come up with and give a solution faster. It also prevents customer annoyance with held calls and long waits on the customer service line. Finally, customers who may have switched products due to a problem may be inclined to stay thanks to the organization being proactive.
2. Better Identify Needs of Potential Customers
Big Data also has the potential to identify the needs of new customers, so businesses can match new clients with the best product option for them. For example, an insurance company could use call center notes, insurance claims and other behavior data to predict what type of insurance policy would be the best fit for a new customer. By matching new customers with the right policy immediately, the customer is less likely to have complaints or start looking for a better match elsewhere.
3. Reduce Product Proliferation
Many businesses’ answer to maintaining customers and attracting new ones is to create more product options. However, all of the options on the toothpaste aisle often leave consumers overwhelmed, so rather than making a decision, they grab something that looks ok and get out of there. If companies were able to narrow down their products to what the consumer actually wants to buy, instead of trying to provide everything in order to ensure sales, customer loyalty and revenue would be much greater.
Businesses can determine consumer preference by analyzing the data found in customer transactions and inventory turnover, then narrow their product offering to what is the most profitable. Companies that take the time to understand a customer’s need will see a significant advantage over their competition, as the product the customer really wants won’t be buried in all the other choices.
4. Improve Customer Experience through Real-time Data
Social media has allowed many businesses to have a more personal conversation with their customers, but that is dependent on customers getting on and interacting on a specific social media platform. Imagine being able to sync into what a customer is thinking even if they aren’t on the company’s Facebook page. Big Data gives access to real-time data about what a consumer is buying, clicking on and talking about. Big Data analytics allows companies to have a continuous conversation with the customer through customized landing pages, mobile apps and advertisements.
5. Make Customized Offers
Today’s customer wants to feel important, and if one company is not able to customize its offers based on consumer needs, he or she will look elsewhere. Big Data can access information like the sex, location and social data of every customer and allow marketers to send different offers to each individual based on his or her interests. Say a marketer uses location based marketing to send an offer when a potential customer is near a store. With Big Data, instead of sending a generic promotional offer, the marketer could send a special deal featuring the purse the individual was talking about on Twitter along with several other complementary product suggestions to go with it.
About the author: Michele Nemschoff is Vice President of Corporate Marketing with MapR Technologies.
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