‘Time is Money’ has long been a familiar business mantra and ubiquitously relates to opportunity cost.
Today, businesses must recognise that data is as much a valuable business currency as time and they need to work smarter to cash in on the opportunities that data offers.
Currency is commonly defined as a medium of exchange and we need to understand how data shares the same characteristics. When unlocked by being translated into meaningful information, data appreciates in value. With the right focus, data can be used as a valuable currency for making smarter business decisions and providing pointers that help legislators frame government policy.
When we now talk about ‘Big Data’, it follows that it equates to big money and if we are going to treat data in the same way we treat money then we obviously need an investment strategy. Rather than just letting the data pile up we need to invest in constantly analysing it for insights that lead to business opportunities.
Data these days is prolific and transient and we need to be able to analyse it quickly to determine future scenarios and opportunities and implement strategies to take advantage of them before circumstances change.
The retail sector is a great example of how this is happening. Retailers are now making use of data analytics to better understand their customers’ behaviours over time and grow enduring customer loyalty. The deeper insights they gain from analysing the data they gather and integrate across multiple channels – in store, online, call centre and more – enables them to design better targeted offers and increase opportunities for cross sell and up sell.
Data analysis has enabled retailers to abandon the one-size-fits-all campaign approach and, instead, listen to the ‘voice of the customer’ to personalise the interaction at the individual preference level, for an improved return on the overall marketing investment.
Other sectors with large numbers of customers are similarly treating their data as investment currency – sectors such as financial services, telecommunications and utilities.
Banks, for example, are taking advantage of their customer data to personalise offers and services in ways that deliver significant additional contributions to the bottom line. Whereas a bank might have previously only called a customer when it wanted to sell a new product or service, integrating and leveraging the data gathered from multiple touch points enables approaches that customers see as genuinely useful and which foster the relationship. For example, making contact when credit card payments are due, proposing travel insurance when transacting overseas or suggesting direct debits for regular expenditures.
When data is used to build an understanding of the customer – from branch visits, online transactions, and social media and so on – financial institutions put themselves in a position to deliver real-time communications based on what the customer is likely to want rather than what the bank or insurer wants to sell.
Leading organisations have recognised the wisdom of treating data as a valuable asset that can be intelligently analysed to improve customer satisfaction, competitive advantage and revenue and profit growth. As the new form of currency, companies need to work smarter to cash in on the data economy.