Tuesday, December 18, 2007

Data Collection Can Be a Customer Benefit

We write a lot about consumer privacy and how it's so very important that companies treat customer information like gold--that they guard it as carefully as they would any other important asset.

But, as a direct marketer, and one who strongly believes in the power of data and analytics, my mind tends to veer in the direction of: What can I do with this data, now that I have it? What can I up-sell my customers? How can I find more people that look exactly like my most profitable customers?

If you REALLY want to be successful, however, you need to flip the coin and start to think about what the data can do for your customer, NOT what it can do for you. (Oh boy, I'm channeling JFK--scary!)

This article from Destination CRM
, brings my point home. It talks about how Amazon now lets consumers edit their purchase history (taking out gifts, for example) to fine-tune their recommendation process. Consumers willingly do this because they have become dependent on Amazon's recs. This point underlined the power of being transparent--letting customers know what you are collecting about them, and why the data is being collected.

"Giving the data back to the customers is just the first step, however. The next is to show customers what they can do with it. This can be in the form of tools like recommendations engines that help customers better find what they are looking for."

The article provides some good ideas of how companies could use customer data to improve the consumers' shopping experience. It points out how apparel retailers, if they mined their data properly, are well-positioned to "develop recommendations systems that can suggest clothes that go with what you have, and best complement your body type." Now, that would be a tool that I could use!

Another example is Home Depot who already offers a tool that helps customers green their home. The article suggests that "with a portfolio of all the appliances you currently have in your home, Home Depot could proactively recommend new products and strategies that can help customers keep their homes green." This is another benefit to eco-conscious consumers.

I really like the thought of thinking of the customer first as you develop database strategies and data collection initiatives. I've love to hear other interesting ideas, or case studies where this was done properly. How did the customer benefit from data collection/analysis in projects you've worked on?

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