2.3.3 How businesses use data
The feedback loop is an important asset to businesses because it helps them react and plan in a constantly changing business landscape. It allows a business to have relevant and competitive offerings that address customer needs. For example, many retailers use loyalty cards to track customer purchases and identify trends. This enables retailers to promote offerings directly to the most relevant shoppers that represent the greatest potential for profit.
A hundred years ago businesses were focused on creating undifferentiated products, selling the same product to everyone. This was aligned with the evolution of mass production during the same time period. Equally aligned were promotional strategies for products, mass marketing using signage, pamphlets, and newspapers in hopes that people would buy the product.
However, a single business product or service is not likely to be needed by every person. A modern business is aware of targeted marketing that creates differentiated offerings based on customer needs. This is why businesses need access to customer data.
Target marketing is aimed at a specific group of people, separate from the market as a whole. This market may be based upon people who live in the same region, or have the same job title, or make a certain amount of money.
For instance, consumer data can show that a particular television programme is viewed most by people aged 40 to 65 with an annual household income of $250,000 or more. These programmes often run commercials for high-end cars because the car companies have access to the viewer data. They will pay for their commercials to run when their target market is most likely to see them.
Micromarketing is an even more precise version of marketing. E-commerce sites and loyalty programmes allow businesses to know more precisely what kind of product or service you may require.
For example, you may receive an email from an online site where you have purchased (or even browsed) before. This email may let you know about a sale on an item that is similar to something you have purchased in the past. Additionally, while browsing the web, you may notice an ad for the exact pair of shoes you were looking at online yesterday. This is not a coincidence.
It is through inclusive practices that enable people to contribute and collaborate effectively that better decisions will be made to maximise value. In fact, better collaboration within organisations is an area that will benefit most from the IoE. Collaboration will facilitate innovative new offerings that realise the potential of the IoE.
Collaboration in the IoE will make organisations more aware of customer needs and opportunities. Customers will be able to solve problems and get advice when and where it’s most convenient for them. Organisations will have new sources of information as people connect using data, voice, video, and social media.
Organisations using collaboration technologies will be able to predict and proactively resolve problems. They will be able to leverage social media to identify potential problems and resolve them before they become a serious issue. They will be able to identify and connect to the right expert at the right time. The expertise of highly-trained and knowledgeable employees will be more easily scaled across multiple locations.
With these collaboration technologies, businesses will experience the increased innovation and agility that will drive their growth. Organisations will be able to foster better relationships between employees who provide creative approaches to offerings, solutions, and processes. They will also be better able to connect decision makers, regardless of location, so that new innovations can be realised sooner.