How Companies Are Predicting Customer Behavior

Most businesses are happy with their profits, and secure in the way their business is headed, but if you ask most owners if they’d like to predict how consumers will behave in their target market three to five years from now, the answer is Absolutely. Owners realize they need to pay attention to data in their business but have no clue where to start. With the collection of data, and data preparation tools,you can understand customer behavior and how to keep satisfied customers.

Meeting the Needs of Your Customers

Long gone are those days when data was typed into an excel sheet and manipulated into a report to meet the needs of a company. Today’s data is vast and meets different needs. It could be based on numbers, for example, the number of sales per day, or specific items sold per day, or the average amount of money spent per customer, per visit. Whatever numbers you collect, the data is going to allow you to see where you can improve when it comes to sales.

Why would companies go through all this data? Because this will also tell you what, if any, products customers are not interested in at all. It can help to ensure that you are actually earning money each day, instead of losing it. Collecting data is not just about numbers. You have varied sources of data that provide a run down of everything to do with your business. Once collected, it’s simply huge amounts of text and numbers that must be properly prepared so that it makes sense.

Piecing Together Big Data for a Bigger Picture

Think about how Google ensures you find exactly what you’re looking for. This is a company that deals with big data on a daily basis. They ensure we all find exactly what is searched for. By using pools of data, they are able to make sure we find the items that best match our searches. Once the data is sifted through, it builds a big picture of the consumer, and you’re able to give that consumer exactly what they are looking for.

There was a study of beer and diapers by one large retailer. The retailer used data mining and found that when men shopped in their store for diapers on Friday nights, also purchased beer. This allowed the company to change the layout of the store and placed the beer next to diapers. This resulted in an increase of beer being sold, and the numbers were dramatic. This research helps us to understand how important data has become. This information could have easily been overlooked, but a pattern was discovered that resulted in a bigger profit.

Companies are realizing the benefits of data gathering and how it adds value to the bottom line. It allows businesses to improve and upsell, based on data gathered about customer behavior. Another little gem that companies picked up on years ago was member reward cards that are scanned during purchases. This allows stores to immediately know what customers purchase on a regular basis, and what types of upsales can be made. Customers see these reward cards as benefits, but companies reap bigger rewards. Its clear data analysis is providing huge opportunities. Not only can it successfully help reduce costs, but it helps with decision making, and knowing how to handle future goals.