Customizing consumer interaction increases revenue by 20%

22/06/18

Companies that adopt data science in their relationship with consumers have revenues up to 20% and get a cut of costs that reaches 30%, says a BCG study of consultancy in partnership with Google.

Customizing the consumer relationship based on data analysis is the most important tool to achieve this result, according to the study. This involves investing in targeted ads and specifically serving the needs of each client.
A good example is how Amazon does in the United States, offering to send milk to someone’s home when the product is nearing its end – or simply predict customer behavior based on what they’ve already bought.

“It’s a combination of two things, attracting new consumers and attracting more value from those that already exist,” says Eduardo Leone, BCG’s partner in Brazil.

While some companies are adopting increasingly targeted strategies, consumer expectations also increase. Offering a product that the person has already bought or miss the moment to show an advertisement are errors that the public tolerates less and less. ,

In Brazil, of the 60 companies questioned by the BCG consultancy, 39% can be considered mature in this area, compared to 50% in the European Union

A mature company uses its own data for advertising campaigns and does not purchase third-party media, always producing customized content

The most mature sector is digital native companies (with more than 90% of online sales), followed by car companies, financial services, services (in general), consumer goods and, lastly, retail.

Retail is the least mature sector because it still has physical channels as the basis of the business, which hinders the transition. It is not so simple to bridge the knowledge gained in virtual environments to physical stores and integrate offline and online experiences.

“One way to evolve is to adopt loyalty programs and explore the correlation between what the consumer has sought in digital and opted to buy in the physical world,” says Leone of BCG.
Of the Brazilian companies in general, 80% already use customer data such as cadastral information, demographic characteristics, transaction data and users’ cookies.

On the other hand, 77% do not have their databases fully integrated online and offline, and 59% do not have integration between databases that are already online.

It was also identified that, in Brazil, 91% of companies do not have advanced personalization of their sites, and 44% do not have any personalization – they show the same results for different clients without taking advantage of the chance of targeting.

In Brazil, almost 25% of marketing investments are directed to digital channels, a small share compared to what is spent in the USA (44%) and the United Kingdom (61%).

BCG cites companies such as Netflix, Amazon, Starbucks and L’Oréal as advanced in data analysis and ad targeting. Amazon’s personalized recommendation strategies are at the heart of what has fueled the company’s growth since the late 1990s.



Source: Folha de São Paulo