The importance of gathering and managing the right consumer data, applying analytics to generate valuable insights and translating those insights into effective front-line action cannot be emphasized enough for companies, especially those that are directly consumer-facing.
Every day, retailers and FMCG companies have access to vast amounts of data, capturing information on every transaction at every store. Access to data has become easier to the advent of the e-commerce sector, where consumer behavior or preferences can be traced with fair certainty. In addition, sophisticated market research techniques are often used to find answers to questions like – what products should we develop and sell? How much is the customer willing to pay? Which products should we discount and when? Which marketing vehicles will allow us to reach the most customers?
In addition to these, companies now have access to social media and reams of large data sets known as big data. Not only this, customer analytics is becoming critical. This is because the customer is now more empowered and connected than ever before. They have access to information anytime, anywhere. This makes it increasingly important for organisations to predict how customers will behave in their interactions with the company, so that you can respond accordingly. Hence combining big data along with advanced analytics offers great potential and countless opportunities to companies across the value chain, since it can offer companies and marketers a deeper understanding of customer’s buying habits and lifestyle preferences, enabling them to successfully deliver relevant offers and attract more customers.
Research also has shown that companies that utilize big data analytics outperform their peers by over 5% and 6% in productivity and profitability respectively. Big data and advanced analytics allow companies to make better, faster decisions in their everyday business and deliver better to customers.
However, it is easier said than done. Exploiting the full potential of data & analytics requires three main capabilities. First, it is the companies’ abilities to choose the right data and manage multiple sources. Second, build advanced models that turn data into insight and the third and the third and most critical is the management’s transformation into translating the insights to effective actions.
A few pointers that companies must keep in mind while embarking upon their data-and analytics journey:
- Begin with a ‘decision back’ approach by crisply answering one question – Which decision do we want to improve?
- Creatively source and manage data – Since even within organisations, different businesses need different data.
- Define data-governance standards – You do not need irrelevant, outdated or inaccurate data. It belies your efforts.
- Establishing IT infrastructure – Companies need a robust It infrastructure to store, easily access, combine, and analyse large data sets and combines close collaboration among business managers, analysts, and IT staff to ensure that data storage is designed in a way that meets business needs and technical IT requirements.
There is great potential for consumer-facing organizations that adopt big data and advanced analytics as a platform for growth. Done right, a data-and-analytics initiative can yield outsize rewards for companies.
Author: Richa Kapoor
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