In today’s tech-driven and a customer-centric world, using big data is pretty much a requirement. However, only just 48 percent of companies have invested in big data in 2016. While that’s up 3 percent from 2015, and it’s expected to increase over the next couple of years, it’s still astounding that only half of businesses are leveraging the power of big data.
To be fair, it’s understandable. In the past, the use of data technology hasn’t been attainable to small businesses because of budget restraints and lack of expertise.
Thankfully, there are now affordable self-service tools that anyone can use – even if you don’t have a tech background. This means that small businesses have access to data that can ultimately help them boost sales. But, after you’ve obtained that information, how can you put it to use?
Here are seven ways that you can leverage your small business data for enhanced revenues.
1. Paints a fuller picture of your customers.
Big data can give small businesses insights on their target audience, including their pain points, shopping behavior, habits, how and where they prefer to shop, why they switch to competitors, what makes them refer businesses to others, and even what they’ll buy next. With this information, your business will be able to more accurately interact and engage with your customers by segmenting your customers across multiple channels and where they’re at in the sales funnel.
In other words, you can target the audience at the right time and on the right channel.
Additionally, you can use this data to analyze customer feedback so that you can make improvements in a product or service.
2. Accurate pricing.
Instead of relying on “trial and error” or “gut feeling” to price your products or services, big data can be used to make decisions like the most efficient pricing strategies. Your business can do this by gathering insights on factors like customer behavior across locations, product/service groups, season, and the current goal of your marketing campaign.
After reviewing this data, you may come up with the following pricing strategies:
- Differentiated pricing where you offer different prices to different groups of customers. It varies on why, how, and when your customers make a purchase.
- Versioning pricing is where you have pricing tiers. For example, a small business owner wouldn’t need to purchase the enterprise-level package when selecting an accounting platform. Instead, they would prefer the option designed for just a handful of employees.
3. Identify trends.
By keeping tabs on behaviors, patterns, and the economic climate gives you a competitive edge since this will help you predict where your industry is going in the future. With this knowledge, you can start preparing your business for what exactly customers are going to demand. And, if the outlook doesn’t look that promising, you can always start to pivot.
In short, big data is going to determine the direction of your business.
4. Better forecasting.
A part of big data is predictive analytics. This uses machine learning and statistical algorithms that process historical data. By looking at past data, you’ll be better suited to forecast customer and sales. This will permit you to generate more advanced reports, make more informed decisions, and develop more detailed plans using successful strategies.
In fact, a study from EverString and Forrester found that predictive marketers are 2.9 times more likely to report revenue growth
5. Scope out the competition.
You can use free and easy-to-use tools like Google Trends to see how popular a brand or product is along with social media analytics tools to gauge popularity and see what others are saying.
In other words, these types of tools can be used to keep an eye on your competitors. For instance, if your competitor is getting more media coverage and social mentions, then you should compare their content and campaigns to see what they’re doing better than you are.
6. Improve customer service.
Regardless of your industry, people demand customer service that goes above and beyond. Big data can help with that too by creating the best omnichannel experience possible and segment customers to their preferred landing page. More interesting, data can be used to match the best sales reps to specific demographics to improve customer service and close more sales.
7. Adjust campaigns in real-time.
While having the power to send personalized messages to the right customers at the right time is pretty impressive, everything can change in the blink-of-an-eye. By using machine learning, you can monitor the changing behaviors, interests, and engagement of your customers so that you can tweak a campaign in real-time, like sending a coupon that interests them specifically.
You probably see this in action after you binge watch Netflix and receive a list of recommended shows just for you. That list changes every time you finish a watching a series or movie.
The bottom line.
Most small business owners aren’t taking advantage of the power that “big data.” Whether if it’s because they’re intimidated by it or assume that its usage is only for “big business,” the fact of the matter is that with big data provides real-time metrics so that you can increase your revenue.
So, instead of being afraid of big data, embrace it and leverage its power.
The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.