Collecting data and analyzing it to develop deeper insights about clients is a capability that can benefit virtually every industry, from financial services to utilities to retail. Understanding clients' motivations, demands and desires may enable a business to develop better products, make their marketing more effective and deliver more satisfying customer service.
Using data to get closer to consumers is also essential for deepening relationships and retaining customers, Michael Vizard writes in an IBM-sponsored white paper.
"It's hard to create a meaningful relationship with a customer that you know very little about," Vizard warns. "Unless you can contribute something that adds meaningful value to the customer's business process your organization is really just one more replaceable element of an extended supply chain that the customer needs to manage."
Being able to effectively harness information can result in more power, he notes, and can vault your business into the position of trusted strategic partner, rather than one vendor among a host of options. However, there are challenges to this vision.
Vizard points to IBM data that found chief marketing officers see data explosion, social media, shifting consumer demographics and proliferation of channels and devices as their top obstacles in getting closer to customers. Meanwhile, a separate IBM survey of chief information officers indicated that two-thirds of respondents think the smartest strategic investments include customer analytics and "related enabling technology."
Of course, collecting data will not provide these capabilities on its own. Businesses need to develop skilled employees and adopt the technologies necessary for cleaning up the data, analyzing the raw facts and figures, putting them into context and then quickly turning that insight into actionable information.
Writing for Fathom's blog, Chad Luckie shares a few "shocking" Big Data statistics, including the fact that more than $600 billion is spent - through lost revenue, cleanup efforts and other expenses - on low data quality
and bad data every year.
Additionally, having bad data in your system can cost up to 35 percent of your business' revenue. Meanwhile, adopting data quality tools and enforcing policies that support data management can add up to 66 percent to an organization's revenue, Luckie notes.
"If properly used, data can help you make better decisions and have a positive effect on your business' bottom line," he says. "The problem lies when businesses do not know how to use the data or collect poor-quality data."