Big data: the customer – no longer an unfamiliar being
Companies nowadays need a much broader and more exact database in order to address customers successfully across all sales and communications channels. Big data is becoming a key competitive advantage.
According to experts, anyone who wants to understand the customer journey but without investing in big data will lose.
Retailers, the advertising industry and manufacturers have been plagued for years by the challenge of “the customer – an unfamiliar being”. However, digitization and the resulting “customer journey” mean that the customer relationship is now even more complex. Are the potential purchasers receptive to e-mail newsletters, do they use Facebook, do they use their smartphone to make purchases? Finding the right moment for the right message, plus selecting the right platform, is more than difficult. The “journey” that a customer embarks on until they eventually make a final purchase decision is more diverse than ever before. The use of classic electronic customer relationship management (CRM) is totally inadequate when it comes to exploring the customer’s journey routes. This is now an established fact.
Companies need a much broader, denser and more exact database in order to address customers successfully across all sales and communications channels. According to a recent study carried out by the U.S. market researcher Kantar Millward Brown, 55 percent of marketing decision-makers admit that their company is not entirely familiar with the consumer journey of its own target group. At the same time, half of those questioned said that their own marketing measures were not the right ones. The market researchers concluded that increasingly complex consumer behavior is unsettling marketing decision-makers. As they pointed out, anyone who does not know the relevant contact points of their customers will not be able to establish a relationship to them.
The most obvious solution of all: big data
Strangely enough, only around a third of all German marketing decision-makers believe that the use of big data will give their department a strategic advantage. Just as many chief marketing officers, especially at SMEs, do not consider big data relevant to their marketing strategy and another 33 percent do not think they are capable to rate its current importance. These were the findings of a study carried out by Reutlingen University on behalf of T-Systems Multimedia Solutions regarding the current status of big data in medium-sized and large German companies.
It is not comprehensible why they are so hesitant with big data, as an investigation by a provider of marketing solutions revealed. They found that buyers, especially ‘fashionistas’, are for some reason quite reluctant and make careful checks before they click on the “buy” button. On average, 195 hours pass between the first contact with a fashion product on the Internet and the article actually being bought from an online shop. Only half of these customers make a purchase decision within one day. And during these almost 200 hours, the purchaser generates a huge amount of data that could be accurately evaluated using appropriate analysis tools. Another recent survey came to the conclusion that the online shopper attaches great importance to useful “accessories ” which make it easier to reach a decision, for example guides to sizes and colors or news about fashion trends.
This could have been easily predicted by specific big data analyses – and a major European food retail chain has shown that it works very well in practice. Consumers can use their customer card on the company’s social media sites, too. If, for example, they like products on the Facebook page and the friends then make a purchase based on this recommendation, the customer will get more points on their customer card. In return, the company will obtain valuable data.
A study carried out by Ernst & Young in the German food retail sector noted: “Customers provide data in the shop, on the homepage, at the checkout and via social media, and they leave behind motion and personality profiles. Big data is becoming a reality and a key competitive advantage. Companies that fail to standardize their data and evaluate it productively will be left behind by the competition.” Evidently, only those who are capable of using big data purposefully will understand their customers' journey.