How to Incorporate Data Into Your Bottom Line Strategy
More and more businesses are realizing the data they need to grow their bottom line is right in front of their noses. Here’s how you can put it to use, too.
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The web is the world’s largest data repository. It’s expected to house roughly 40 zettabytes by 2020, making it the number one source for generating valuable information. As a result, businesses are leveraging data that’s hidden in plain sight to increase their bottom line.
One particular strategy that’s helping companies capitalize on information is web data integration (WDI), a process that aggregates and normalizes data to make it more digestible through intuitive reporting and visuals. It relies on a similar concept as traditional web scraping, but is much more sophisticated and places an emphasis on quality control.
This data includes everything from social media posts and product reviews, to email receipts and satellite images. Businesses can use it to gain detailed insights, make better business decisions, and improve operations, saving both time and money. Here’s what you need to know.
Reduce client churn
“Customer churn is the percentage of customers that stopped using your company’s product or service during a certain time frame,” explains marketing expert Swetha Amaresan. “You can calculate churn rate by dividing the number of customers you lost during that time period – say a quarter – by the number of customers you had at the beginning of that time period.”
Failing to keep client churn in check can be detrimental to the success and longevity of your business, so make minimizing churn a top priority – it will help you get the most from your client base and keep it profitable.
Start by taking advantage of tools that can help reduce churn. For example, customer success software Planhat serves as a “customer data hub” to help businesses learn more about their clients, predict churn, and identify upselling opportunities while they’re hot. And when customers are at risk of churn, they’re “flagged with sales reps” so they can take action and try to remedy the situation.
Increase consumer loyalty
Techniques like data mining and web scraping, which analyze large data sets and identify meaningful patterns, can be instrumental in boosting consumer loyalty. They can be used to fine-tune your pricing strategy, monitor customer sentiment, identify common pain points, and more. By correcting glaring problems and improving the customer experience, increased consumer loyalty naturally follows.
Custom skincare solution provider Proven is one company that successfully leveraged the data hidden in plain sight through web scraping. They analyzed 8 million reviews, 100,000 beauty products, and 4,000 scientific articles to gain detailed insights into customer needs and sentiment to fine-tune their products and customize them for individual customers. As a result, they were able to develop higher-quality products and create a more personalized experience, which led to increased customer loyalty.
This is something you can do, too. It’s just a matter of identifying the right channels to analyze that provide the deepest insights into customer sentiment. If you have a significant social media following and a lot of online reviews, for instance, you could analyze that data to pinpoint potential areas for improvement.
Discover hidden profit
A recent study by TRUE Global Intelligence found that 55 percent of modern organizations’ data is “dark,” meaning it’s unquantified, untapped, and often unknown. But the companies that are able to effectively tap into it can unlock hidden profits.
For example, Netflix collects data to provide users with highly-targeted content. Analyzing the shows and movies users have previously viewed – as well as their search history – allows Netflix to create a completely personalized product, where no two customer experiences are the same. In turn, customers stay more engaged, which inevitably results in a larger customer base and bigger profits for Netflix.
In the case of Facebook
On the flip side, data also has the potential to lead to a loss if mishandled. A prime example is the $5 billion fine that Facebook recently received for violating privacy practices. The world’s largest social network had 2.41 billion monthly active users as of the second quarter of 2019 – and access to an enormous amount of data.
While the full details are currently unknown, reports indicate that Facebook used data mining that breached its users’ privacy, which highlights how important it is to adhere to rules and regulations regarding data governance.
We’re living in an era where data is being generated at a record pace. There are 2.5 quintillion bytes of data created every single day, and 90 percent of the world’s data was generated within the last two years.
And businesses are discovering that the most valuable data is the everyday information that’s hidden in plain sight. While individually it may not have much of an impact, it can create a huge competitive advantage when analyzed on a large scale and grow your bottom line.
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