Achievement of revenue target in any business is based on the fact - how well we know our customers, i.e, their whereabouts, preference, age, etc. because everything counts. Each of such detail is crucial and important for business and the use of data science is its best security.
Knowing your existing customers has the same importance as knowing the competition. The best way is to use data analytics is to check patterns of behaviour, and based on needs adjust the business model. As we all know, data analytics is analysing the raw data to enable us to make an opinion based on outcome.
The market pattern can be checked by using social media, where followers and anonymous 'like and share posts' and that shows the likability of a product. Filtered data of 'likes and share' of the post reveal the age, gender, and location of the individual. A complete understanding of how appealing the product are, this the management gets to know. If a fashion store gets more likes and views of specific type of clothing, represents its fashionableness, which can prompt the management if they require changes in the product line.
Similar principle are used when a store uses a ‘loyalty' card. The advantage or the attraction of a loyalty card to the customer is to avail discounts and privileges associated to it. However, the store that uses the loyality card doesn't give these privileges or benefits free of cost. Loyalty card generates tons of raw data. Such collected data, once processed, gives a pattern of customers' purchase behaviour. Not on their preferred product, but the data also reveals that if a product is sell at a discount, or how long does it take to clear the shelf. With this known pattern, they can clear even a volume with a discount. The data also reveals the 'best days' for discounting. The processed data answers many questions which the management otherwise would've struggled to find.
Based on the results of data analysis, the outlet manager can re-arrange the boutique or store based on the preference of sale. The loyalty or discount card gives the most valuable product, and that is 'data'. This is the new gold.
A wider database can indicate the customers need accurately. Using the 'higher spender' in data base and prompting them to have frequent visit to stores, by adding extra privileges, is another way to improve revenue potentials.
Take an example of Starbucks stores where they encourage their customers to use the Starbucks card for the purchase of the products, i.e., coffee or bakery with an offer of free coffee any size after a set number of points earned. For payment, the use of Starbucks loyalty card is encouraged. Starbucks ensures this by offering free coffee and other promotions only when you use the loyalty card. One common visible feature in all Starbucks stores is limited quantity of food items or snacks offered. The items are always available till late evening. Nearing the closing hours, they sell almost all the food items. How do they do that?
Managing perishable inventory and reducing wastage and pilferage is an arduous task for food-related businesses. However, they manage this well with the use of the database. The data analytics can reveal the pattern, purchase habits, and shows the product that sells faster, i.e, average sale time/unit. All these details can be secured by ‘knowing your customers’, with the use of data.
Customers’ insights play a crucial role in innovation and creation.
The customer’s insight assists in the communications strategy. It helps to reach customers and the market, which can be transformed to the motive of generating revenue by creating content to promote business based on the story built up around customer needs. A story that rotates around the business brand. Authentic content gives value and produces the desired outcome. It is not about you but about your customers and to promote their interest, need, preferences.
A newly furbished tapas lounge can be an example, where the outlets already has a customers base also a large social media followers. The refurbishment of the lounge has a completely new concept and, thus, after substantial investment, the payback is important. With this database, the communication strategy can be strengthened.
Using this communication strategy, we can update the customers about the refurbished product, which will ensure the preference based on diverse age group. The goal is to generate awareness of the refurbished product. Along with the existing customer group, the targeted audiences include the customers from competitions. An arduous task that requires complete new thoughts, novel theory, and philosophy. Because if we continue with old thoughts and ideas, it will be difficult to get the desired results. Therefore, innovation and creation of fresh concepts are necessary.
Even with multiple promotional events, improving product demand takes months, making the communication strategy's role vital. It can generate demand much faster, also all the planned targeted advertisements and events become effective if we know our customers well enough. The targeted customers include loyal customers and the customers of the competition.
A communication strategy must have an insight into the product and explains the brand vision. The communication can be verbal, non-verbal, or visual. How we reach a correct customer is depends on how much we understand them.
The importance of knowing customers is by using the database effectively to achieve impressive numbers.
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