Entering the infinite ecommerce market with existing ecommerce giants such as Amazon could be a tiresome task. As an online seller, you have to not only establish a successful ecommerce business but also scale the top of the competitor’s list. It sounds impossible, right? Well, let us tell you, every giant ad well-established industries would have some loophole. You need to find them and use it to boost your ecommerce sales. Delivering the best seamless customer experience include showing personalized product search, delivering the customers with what they require, and most importantly understanding the customers and showing them the results they are actually looking for. How can you understand a customer? The answer is simple – customer data.
Data is of prime importance for all kinds of businesses. With the increase in companies as well as technologies collecting and using data, businesses are evolving their abilities to sell more, online. The internet and the right use of Artificial Intelligence are what help companies capture, process, and analyze data. Such companies are learning their customer behavior, shopping pattern, interests, day-to-day choices, and shopping influences. Their key focus is on collecting the customer data that includes predictive analysis, consumer base data, etc. Some companies build an entire business model based on consumer data wherein targeted ads and third-party selling using consumer data. But, how are they collecting consumer data? In this blog, we will be discussing the importance of collecting customer data and how are online retailers collecting and using consumer data.
How do retailers collect and use consumer data?
We very well know the convenience of shopping almost everything you need right from your smartphones, tablets, or computers. No traffic, no standing in long queues, and no hassles of walking until your legs give up. Online shopping has indeed revolutionized the concept of selling and purchasing. Well, have you noticed? When you search for a particular product and leave a particular site or browser, the next time you visit the same, all you find are the products you were actually intending to purchase. Now, how did that happen? The answer is, the retailer collected your data and shopping habits and leveraged it to show you the results you want. Online retailers use consumer data to show the consumers what they are looking for; price the product as per the data, and the ways to market that product to you. In order to get sales from you, the retailers need your data.
This might irk a few touchy customers as they consider it as trespassing through their private details. Well, there is nothing to worry; the data collected by retailers are exclusively for offering you with what you are looking for without exploiting your data. When collecting data, it does not matter how much data you collect, but, it is all about how you are using the data to leverage your ecommerce store. You might very well know how enormous ecommerce giants like Amazon are! They exactly know what you require and what your specifications are. How? It’s simple, collecting consumer data.
Consumer data can be collected in three ways:
- By asking the consumers directly
- By tracking consumers indirectly
- By adding consumer data from other sources
So, how are such online retailers collecting and using data? Let us have a look:
Online activity
You might be well-aware that the prices rise and lower based on a few circumstances and source of purchase. This is what retailers do to compel consumers to purchase products from them and not from their competitors. When you visit a particular website, the tracking cookies help retailers collect your data. Through this data, they monitor your online activity such as the time you spent on that particular website, what you clicked, what you purchased, what prompted you to purchase and so on. This information is then used to give you personalized results for the products that you are interested to purchase.
Transforming data into knowledge
Collecting huge amounts of data may create havoc on how to process and analyze the data. Reading the consumer data manually is near to impossible or possible with certain drawbacks. However, with the use of the internet, processing and analyzing data can be done round the clock. With the right use of AI and other such technologies, retailers can break down the process of collecting, processing and analyzing the data.
Online Surveys
The perfect method to know what your consumers or visitors think about the products you sell is to ask them directly. Online surveys help retailers understand the consumers’ perspective and think alike to provide a seamless consumer service. There are chances that consumers do not take the survey. In order to avoid such situations, you can make sure to attract customers with a sleek design and creative survey content.
Social Media
Collecting consumer data through social media platforms is much more than creating online selling pages in those platforms. Social media platforms can convey a lot about how customers react to some ads or what are their views on the products they see. Online retailers can get an idea of the likes and dislikes of consumers through these social media platforms. Each time a consumer makes a public comment likes or dislikes a page, product, or service, retailers collect their preferences and shopping patterns through it. When such retailers provide a personalized experience to their consumers who are already interested to purchase the products they sell, they get the perk of bringing loyal customers to their clientele base.
Importance of Collecting Consumer Data
Personalization
Customers visiting the online store are of different categories. For instance, there might be new customers who are visiting your store for the first time and then there would be customers who are loyal to your online store. Every customer enjoys the personalized experience and characterizing the personalization experience based on the type of customers can help in enhancing the sales two-fold. All these are possible only if you what customers fall into which category and that is where consumer data is a useful asset for your store.
Predictive Analytics
Analytics is an essential tool for online retailers irrespective of its size. As an online retailer, it is nearly impossible to develop without analytics. Consumer data helps online retailers identify consumer acts even before it takes place. It helps in predicting events in the online selling market. This method is termed as predictive analysis. For instance, you can predict the revenue you’ll be generating from a particular product in the next quarter. Wouldn’t that help you manage your stocks, inventory, and avoid the consequences of product going ‘out of stock’?
Visibility in the Supply Chain
The customers must rightly know what the availability of the products is, where their order is, and what the status of their orders is. This can be a deadening task if you have involved multiple third-party companies in the supply chain. However, it is an essential step to keep your consumers happy. And for that, you need to merge the data from warehousing, packaging, transportation, and manage them efficiently. This process becomes extremely easy with the help of consumer data.
Smooth Customer Service
Every customer looks for a seamless service from the ecommerce store they are investing in. If they do not get their queries answered and problems resolved, remember that they might get someone who actually pays heed to their issues. Smooth customer service includes answering the customer’s queries and providing them valued answers or solution at the earliest. This is possible only if you are collecting consumer data at the right time in the right manner. Once you have the consumer data, you can easily keep your valued customers happy and bring in more sales to your store.
Dynamic product pricing
If the products you sell online are high on competition and you are offering a competitive price tag, you must make sure that it is dynamic. By dynamic pricing, what we mean is that the price tag you give to your products must be in accordance with the competitor pricing, regional preference, customer requirements, regional buying patterns, and product sales. With the right use of dynamic pricing, you can set a competitive edge to the products you sell and give all the right reasons for your customers for purchasing products from your ecommerce store. Setting dynamic pricing, again, is easy with consumer data.
Huge businesses are expert in collecting data from every corner of the online world. The most obvious sources are customer activity on websites, social media platforms, and applications. Some other methods include location-based advertisements that help in collecting the consumer’s IP addresses in order to create a personalized shopping experience. This information is later used to target consumers by providing relevant and personalized advertisements. Also, companies use their customer service records to check the past interaction of consumers with their team members. By doing so, they get direct feedback on what is accepted by the consumers and what is not. Apart from collecting data, companies can purchase consumer data from the market from third-party resources.
