As you are well aware, the business world has gone through some of the most rapid changes within the last few years. Of course, it’s not easy to keep up with the ever-changing business intelligence world.
But with the advent of digital marketing and online analytics, companies now have possibility to learn more about their customers than ever before. In fact, it’s been reported that 90% of the world’s data has been created within the last two years alone.
Just think, how big positive impact would have on your business information like what marketing channels convert at the highest rate? Or which periods of the day are customers more likely to buy? Or maybe what advertising messages drive more people complete a desired action?
Big data and predictive analytics take this kind of information on a higher level. By analyzing an enormous amount of data in real time, organizations will become quicker to make decisions on competition, internal efficiencies and customer insights.
There is a misconception that all of this user tracking and mass data collection as seen as “spying” on everything a person does online. In reality, predictive analytics works to collect relevant information on what interests and excites you. This allows organizations to theoretically create a profile for each customer based on their behavior and buying history, among other things.
Now, how your business can benefit from predictive analytics? Well, some of the ways small and medium businesses can benefit from predictive analytics we list below:
A lot of collection resources are wasted on customers who are difficult or impossible to recover. Predictive analytics can help optimize the allocation of collection resources by identifying the most effective collection agencies, contact strategies, legal actions and other strategies to each customer, thus significantly increasing recovery at the same time reducing collection costs.
For an organization that offers multiple products, an analysis of existing customer behavior can lead to efficient cross sell of products. This directly leads to higher profitability per customer and strengthening of the customer relationship. Predictive analytics can help analyze customers’ spending, usage and other behavior, and help cross-sell the right product at the right time.
With the amount of competing services available, businesses need to focus efforts on maintaining continuous consumer satisfaction. By a frequent examination of a customer’s past service usage, service performance, spending and other behavior patterns, predictive models can determine the likelihood of a customer wanting to terminate service sometime in the near future. Predictive analytics can also predict this behavior accurately and before it occurs, so that the company can take proper actions to increase customer activity.
Predictive analytics can help identify consumers with a higher likelihood of responding to a particular marketing offer. Models can be built using data from consumers’ past purchasing history and past response rates for each channel. Additional information about the consumers demographic, geographic and other characteristics can be used to make more accurate predictions.
Predictive analytics can streamline the process of customer acquisition, by predicting the future risk behavior of a customer using application level data. Predictive analytics in the form of credit scores have reduced the amount of time it takes for loan approvals, especially in the mortgage market where lending decisions are now made in a matter of hours rather than days or even weeks. Proper predictive analytics can lead to proper pricing decisions, which can help mitigate future risk of default.
Clinical Decision Support Systems
Experts use predictive analysis in health care primarily to determine which patients are at risk of developing certain conditions, like diabetes, asthma, heart disease and other lifetime illnesses.
As you can see, your business can definetly benefit from big data and predictive analytics. If you are interested in exploring the power of predictive analytics and improving your business, you can contact CERAiT Big Data Predictive Analytics Lab and find the right solution for your needs.