Why Is Big Data a Big Deal?
WHY IS DATA SUCH A POWERFUL TOOL FOR SELLERS?
The world is full of data, which is in turn full of insights about how to drive your online business forward. It’s vital for companies to understand what the data they have on hand is telling them about their customers. In this article, we’ll look at the types of data available and how to analyze them to your advantage.
In the ultra-competitive landscape of online marketplaces, smart data analytics can provide insights that help brands differentiate and increase relevance. Instead of a broad outreach, you can, armed with meaningful information about your customer base, align your marketing strategies to the customer experience. In short, data helps ensure you’re communicating the right message and meeting your customers where they are, e.g. identifying and relating to their mindset, shopping behavior, and evolving consumer sentiment trends, ultimately driving your bottom line. A survey conducted by McKinsey polled over 1000 sales organizations from around the world and asked them about their use of data to grow their sales. Here’s what they found:
- 53% of companies considered fast-growing–defined as companies growing faster than their peers and at greater than 6% per year–rated their use of data analytics as extremely effective or moderately effective.
- 57% percent of companies surveyed do not view themselves as effective users of analytics, in spite of the clear, tangible benefits.
Still, despite the obvious advantages of effective data analytics, many companies lag behind when it comes to data optimization, which, of course, equals a strong advantage for those who stay a step ahead.
Types of data
For the purposes of this article, when we talk about data we’re referring to three categories: customer, financial and operational. Here’s a quick breakdown of what they are and how to make the numbers work for you.
Encompasses all aspects of your customers’ shopping behavior, capturing email addresses, previous purchases, website and app engagement, social commerce, organic social media, paid engagement, and more. Thoughtful and strategic analysis of customer data provides an opportunity for you to evaluate your target customer in a nuanced, detailed way that in turn, you can leverage to inform your marketing and advertising campaigns, as well as your product offering and customer service experience.
A thorough review of all your sales numbers, across all channels, along with marketing stats, pricing comparisons, P&L, ad budget, and inventory status, among other financial data, is a fundamental piece of operating a cost-efficient, profitable brand and maximizing returns on your marketing and advertising campaigns. We recommend having someone on board who’s a numbers whiz, and can quickly and easily translate financial data for the benefit of your entire cross-functional team.
Leveraging your operational data is more crucial now than ever. Given continued strains on supply chain and inventory challenges, clear operational data and the insights you surface are the key to streamlining logistics, shipping, storage and warehouse efficiency, fulfillment, and delivery, among other supply chain functions. The more you can anticipate, the more prepared you’ll be to sidestep operational obstacles. And, the more data you gather, the more you can anticipate.
How do I leverage my data?
In a world where consumer information is coming at light speed from every direction—most often in the form of data and statistics, it can be challenging to both identify the most meaningful data as well as optimize it for your brand. Here are a few ways you can use your data to make strategic decisions that ultimately drive the bottom line.
Maximize current customer potential
You can use data to understand not only how to reach prospective customers and acquire them, but also to help maximize returns from your current customer base. By analyzing past customer purchasing behavior, as well as demo- and psychographic info, channel preferences, traffic drivers, winning products, and successful campaigns, you have the tools to build on existing customer relationships by adapting to their needs and behavior.
Optimize your pricing strategy
Understanding the competitive landscape at a detailed, real-time level, as well as getting a grasp on the market trends at large, will give you virtually instant insight into your competitive pricing strategy and allow you to maximize margin without pricing yourself out of the market.
Deep dive into your product
Use your data to get both a high-level and detailed view of your product offering. Which items are selling best? Which are lagging? Are you seeing unexpected winners or losers? Why are initially rapid sales in decline? Knowing these and other elements of each of your products can help you solve problems, stay on top of competitors and better forecast inventory needs.
Increase customer retention
Have customers who haven’t engaged in a while? Figuring or why by analyzing your customer data can help you effectively retarget customers with personalized interactions and other incentives to drive them to convert.
Knowing your competition
An in-depth competitor analysis will provide tremendous insight into where and how your competitors are performing well—and what you can do to pivot and stay in the game.
As tech in big data advances daily, there is more information available to more people than ever before. Use it thoughtfully, and it can become your new best advisor on understanding how to serve your current customers, acquire new ones and accelerate your brand to profitability and success.