Businesses across many different industries are now investing in highly sophisticated data technology. They are realising that these new brands of ‘super software’ are the future. More and more there is a need to know customer profiles. Businesses want figures turned into facts, and statistics made into stories about:
- How well they’re doing
- Who their customer base is
- Who they need to target
- Where they need to go next
Statistics can even help them anticipate where the next trends in the markets will be. Essentially, data has become a business lifeline.
The UK High Street
A simple example of this can be found every day on the UK’s high streets. You walk into a shop, choose something, head to the desk to buy it, hand over your card and……you’re asked whether you wish to be put in the company database to learn of sales and promotional events. But here’s the trick: to register you have to part with your email addresses, telephone numbers, date of birth, marital status and postcode. Then they can tempt you every month with offers, until you eventually give in and spend.
The ‘clubcard’ phenomenon is a fantastic example of how data has become the backbone of some of the UK’s biggest businesses.
But why are they all doing it? Giving away loyalty discounts is a price they’re willing to pay so that they can trace which products you buy. Analysts can work out who is buying what and when and then tailor special deals to get you spending to suit your habits. Customer data has become business gold.
On the other hand, customers respond to statistics aswell. Back in 2010 Tesco defied the recession when it declared profits of £3.4 billion. Perhaps its recipe for success was its decision to up its in-supermarket deals to keep customers loyal: 3 for 2, 2 for the price of 1, BOGOF (buy one get one free). It is highly likely that every time you shop you will buy something in response to one of these: it is advertising using, albeit very simple, statistics.
A more sophisticated example of businesses capitalising on a data-driven world can be seen in digital journalism sites like OWNI. Earlier this month it was reported that OWNI was making money by giving away its content. Being interviewed for MediaShift the site’s director of data journalism, Nicolas Kayser-Bril, explained how they make their money:
‘We specialize in providing apps and social media platforms. Half of our sales today have to do with social media, and the other half has to do with data visualization, crowdsourcing apps, and running innovative journalistic products. We serve all kinds of institutions and NGOs that have a story to tell but don’t know how to do it online. We build the tools for them to do so.’
The online market has been swamped recently with new data initiatives taking off. Another of the latest is a ‘FTL’ (Faster Than Light) new system designed to meet the needs of sectors such as banking and trading. The manufacturer, TIBCO, has said that it reduces the time it takes for information to be sent and received between applications, and could offer a significant competitive advantage. Tibco has yet to divulge how much FTL would cost, but has said that the pricing model would be on a per application basis (which probably means it’s pretty pricey).
Data sifters have become a precious commodity in today’s business landscape. Tools and software designed to help businesses tap into new revenue sources have ever been more popular. The people with the skills to help businesses access customer and economic-related data will no doubt grow in popularity over the coming year. A brand new market is emerging.
By Emily Lingard (@EmilyLingard)