IC Summits Virtual Event: Health, Wellness & Beauty
Topic: Activating data for success
Date: 12th May 2021
Panel moderator: Tyler Leshney, Co-Founder, Dabble & Dollop.
As the world continues to battle through the Covid-19 induced turmoil, businesses need to make better use of customer data to adjust to the “new normal”. The modern consumer has a plethora of choices. This, coupled with an increasing proliferation of social media means that the only constant in consumer behavior & preferences is change! To decipher this ever-changing consumer behavior and attune themselves to it, brands are resorting to data and technology like never before. The panel discussion was split in two different segments. First half was dedicated to data collection and usage from a company’s perspective, and the latter half focused on the customer journey.
Here are some of the key questions and answers discussed on this panel.
Question: What are some key data points businesses look for and how are these data points utilized?
Answer: Businesses really need a plethora of data to help with segmentation of customers. With more insights, businesses can tailor their offering for specific customers.
Question: What should businesses do to retain customers once they acquire them?
Answer: A loyal customer is worth 10X their first purchase and a business stands to lose 90% revenues if a new customer churns after the first purchase. Preserving this revenue is important, in light of the fact that it is 7X more expensive to acquire new customers compared to retaining existing ones.
After the first purchase, it is imperative to look out for signs of churn and create a predictive model using data points. The checking of historical data for specific verticals, the customers’ engagement with the brand, repeat purchase rates, etc. are just some of the factors that need to be monitored. Based on these telltale signs, businesses can anticipate and proactively create campaigns and strategies to retain these customers. An example discussed was of credit card companies giving freebies for the first three months of card usage. In this context, it takes approximately three months for a customer to be engaged with a credit card, thereby minimizing churn!
Question: How should a business manage mountains of data cohesively, yet make it available to customers and employees as required?
Answer: A highly data driven program must be able to collect and work on data depending on the channel it is derived from. Data collected from a B2C channel will vary from a D2C channel and hence it will have to be treated differently. A size-fits-all solution will not work in handling data. Businesses then need to create processes for the flow, storage and analysis of such data through the company. In cases of commonality in the data, businesses need to decide on how to bridge such data usage to get more insights.
Question: What are the best practices recommended for data collection?
Answer: The first step is to determine the correct usage of the data. Once this is established, the business must identify all the touchpoints this data would be available from and tap into those channels.
Any data collection method must be compliant with all necessary regulations. Customer data should be treated as private within the company and employees must be given access on an “as needed” basis.
Upcoming data privacy updates will have big ramifications for businesses. Only 4% of the people have opted to get customized ads from Facebook after the new IOS14 update. That has resulted in 25% increase in customer acquisition costs. This data brings with it some opportunities as well. With this the panel shifted to the second half of the discussion talking about the customer’s perspective.
Question: How do you use the data you have already collected to get more out of existing customers.
Answer: Word of mouth remains the best source of customer acquisition. Gamification of referrals or social sharing activities through a loyalty program helps businesses improve customer engagement, converting loyal customers into brand advocates.
When it comes to D2C or wholesale channels, businesses find it difficult to learn about their customers. In order to learn more about customers buying from third-party stores, features like receipt scanning and code exchange through a loyalty program are quite beneficial. Customers willingly share receipts, which lead to valuable data & insights on their demographics, buying behavior, and other information.
Such activities allow businesses to reduce their reliance on ads through third-party cookies and instead own their customer data.
Question: What is next in terms of technology platform usage to activate data?
Answer: With new security updates, businesses still need to compete for customers’ attention. In such cases machine learning can help create different customer cohorts and run targeted promotions. Over time, these algorithms can identify areas of high potential for a business to act upon. Technology platforms with such automated systems will hold the key to activate data in the years to come.
This virtual event covered important trends and statistics to best activate data for the success of a business.
- Businesses need a plethora of data to help with customer segmentation. With more insights, businesses can tailor their offerings for specific customers.
- It is imperative to look out for signs of churn and create a predictive model using data points. Businesses can anticipate and proactively create campaigns and strategies to retain the loyalty of these customers.
- Any data collection method must be compliant with all necessary regulations. Customer data should be treated as private within the company, with role-based access for employees.
- Gamification of referrals or social sharing activities through a loyalty program help businesses increase customer engagement and retention.
- Machine learning based segmentation and automation of targeted promotions will be the key to future data activation for business success.