Big data is a huge pool of collectible information on customer shopping patterns and habits that provide insight on how to increase sales, while also keeping the client happy and satisfied. All of the big players like Amazon, eBay or Google have heavily invested in big data development, thus giving them an incredible marketing advantage. Here’s how proper big data analysis can help you boost sales.
Everybody has their fair share of creepy moments on the internet, and one of them is getting suggestions for something you’ve been dreaming for the last two months. “How did they know I’m searching for handmade Doc Martens sporting a British flag and those cute mini skulls? And why do they cost the same as the ones made in Taiwan?”
I’ll tell you why. It’s because you’ve been going a little crazy binge-searching for your beloved shoes and talking about it on social media, so Amazon decided to give you an offer you can’t refuse.
Harvesting information for the purpose of increasing sales and keeping loyal customers is nothing new. Companies have been hunting for hints, suggestions and insider info since the dawn of civilization – all for the sake of bringing in some extra customers into your store, and convincing them to open up their wallets.
For ages, people have been relying on their gut to make a profit, but statistics show that predictions based on the “gut feel” are only 40% of the time correct. Internet-based companies don’t do that anymore because collecting and processing big data proves to have better results.
The World Wide Web really does feel like a rainforest sometimes – it’s vast in information, out of control, and confusing to the customer, plus the competition for content marketing is huge, so it was only a matter of time that companies would start helping people out (and themselves too) by offering personal deals.
Actually, 73% of consumers prefer using sites that offer personalized content and give relevant information. To achieve this, companies use advanced big data analytics tools to collect info on what clients like, hate, ignore or show how much time they spend reviewing certain items. It’s also useful to know interests, hobbies, desires, behavioral patterns, or any other data that paints a better picture of your customer.
Analytics tools will give you detailed reports on market tendencies and points that need to be pressured in order to achieve a certain result. You will be able to send tailored offers, target specific groups based on interests, age, social status, income, etc.
To make things better, build up a suggestion engine and watch your sales skyrocket, as it’s difficult to refuse deals that strike the right nerve. Imagine if you land an offer going to Brazil for two weeks (your childhood dream), all included, to your 3 most favorite cities, including a hiking trip in the Amazonian jungle and participating in Rio’s Carnival.
It would seem that such offers are pure luck, but most likely it’s the case of good marketing and collecting the right information.
Price is a major factor for any buying customer, and this was big data development that also comes to be very handy. The main goal for any company is to set an optimal price for their products – that means not too low, not too high. Everything needs a nice balance so that people keep buying, but you can still continue making a profit.
75% of a typical company’s revenue results from its standard products at the same time, 30% of the pricing decisions these companies make every year fail to reach the best price. Where a nominal 1% price increase resulting in an 8.7% increase in operating profits, assuming there is no loss of volume, pricing can dramatically grow the profitability.
Big data analysis enables market analysts to study a wide range of market factors and combine the data with the company’s accounts statements to reach the optimal price of a product or service.
Companies can achieve this through a retrospective analysis of consumer’s purchase history, behavior, and choices. After that one can use statistical analysis to determine the price elasticity of demand by combining the purchase data and market dynamics.
And to finish it off, companies should analyze the costs incurred in manufacturing and identify the price point with maximizing profits. In the long run, such analysis helps you gather some vital information – the level of reduction in prices, impact on profits, and optimal time of making changes in the pricing.
Reduced Research Time
Research is key to reaching success. Everybody understands this and constantly digs for some relevant info on their customers. The only problem is this – how long will it take until I start seeing results? According to a survey, people often manually analyze 15 different external sources like Twitter, LinkedIn, Facebook, and the web, next to all the internal data sources they have to analyze.
Other studies show that marketing staff spends 24% of their time doing research, resulting in lost sales opportunities. The good news is that big data tools can do this better and faster than humans, plus they can deliver automatically generated, detailed reports of prospects so that all your sales reps have the same information, in a fraction of the time. Get yourself some good software and forget wasting time on manual research.
Analyzing sales data from local stores across the globe can help organizations accurately select the best-selling products. Patterns can be found in historical and transactional data and can be used to identify risks and opportunities in the future. Companies can target opportunities with higher scores.
This allows sales teams to manage their time more effectively, and improve overall sales effectiveness by accurately targeting the right opportunities. This information will help organizations determine which products to sell at what location and to make real-time adjustments if necessary.
This will ensure, for example, that a store is not out-of-stock of a certain product when the product suddenly goes viral in a certain area, as big data analytics could have predicted it.
What is the Future of Big Data?
Big data analysis is an undisputed leader in modern marketing. Companies that take a more data-centered approach improve their marketing return on investment by 15–20 percent, so investment in big data development will only grow, and businesses will have to come up with even more creative ways to mobilize people into buying.
The fact is that once a company equips big data analytics, it becomes easier to connect with customers using a customized approach and help them turn interactions into conversions that will, hopefully, evolve into long-term friendships. It‘s important to understand that the online market is very competitive.
Everybody is fighting for attention. To be honest, it got so competitive that you won’t achieve much without putting your full focus on customer psychology using analytics tools. Contact our IoT specialists for more details