Big Data and the consumer
There are always ongoing discussions about the business benefits and challenges of Big Data. There's even been a lot of consideration about how Big Data impacts the customer experience. But thus far there has been very little discussion about the benefits for the average consumer.
As customers grow increasingly aware of the value regarding their personal information, they will begin to demand more for it. In fact, in countries like Germany, the data privacy laws have become very strict in response to the perceived abuse of personal data.
Many European businesses have long heritages and a loyal customer base, but since the arrival of Internet searches, social networks, online reviews and comparison sites, it's become very easy for customers to look elsewhere, compare service levels and find better deals at home and across borders. As a result, slowly but surely customer loyalty is being eroded. But it's important to state that we as consumers are not only seeking the cheapest price, but rather the best value for money and we really don’t mind who provides this as much.
So how do businesses go about reversing this trend and implant trust?
By showing that they are on the side of the consumer. This can be achieved through better understanding of the customer, better service and greater transparency. In achieving these goals, Big Data and analytics can play a huge part.
Effective use of Big Data will enable these digital experiences to become more than just another marketing tool. By using freely available open data sources, along with existing customer data, organizations can make these tools invaluable to the end user. They could, for example, combine transaction history with geo location information to offer localized discounts.
The biggest challenge for European businesses is overcoming the negative sentiment around personal data gathering and usage. This consists of the disparity in culture and law around the storage and use of personal information.
The demand for more accurate, personalized and informative services is rising, as businesses seek to justify the information they harvest. But let's see this from a personal perspective for a minute – after all, we're all consumers.
A well known saying states: 'If the service is free, then you're the product'. But if we flip this idea and think of our personal data in terms of its value, then we can start to consider what we're getting in return for the information that we provide. Suddenly the idea of how to use Big Data for consumers becomes a lot more clear – simply provide benefits that are equal or greater than the value of the information being provided.
If a business wants to avoid losing customers and having the associated data locked up in data privacy laws, this needs to be the starting point of the conversation.
A better understanding of customers and a structure of loyalty and trust can be obtained by creating two-way relationship businesses.
Whilst consumer data can be used for better advertising or to improve processes and profits, that same data can be used to provide advice or offer discounts.
Data and analytics can make businesses much more integrated into daily life by providing smart, trusted advice that customers need and use daily. Retailers are stepping forward with this customer-centric view, some are even venturing into the world of finance, but the consumer and regulatory landscape is rapidly changing.
For now, companies have the data advantage, and staying competitive requires them to learn how to use it.