Everything! Let me explain.
Wouldn't it be great if you could know NOW with almost complete certainty the events that were going to happen next week or next month or next year that would impact your customers or your business?
If you did, you could take action to benefit from the opportunity, or prevent the potential loss of a customer, for instance.
Well that's exactly what companies are now doing using a tool called Predictive Analytics. They analyze data about their business, combined with information about their customers and prospects in a way that allows them to predict what is going to happen, and take advantage of a competitive edge other companies don't have.
This is where Beer and Pop-Tarts come in. Wal-Mart put Predictive Analytics on the map in 2004 when dealt the double-whammy in Florida of Hurricanes Charlie and Frances.
When the hurricane warnings for Charlie were issued, Wal-Mart tracked everything - the weather service hurricane data, customer information and spending patterns. Three weeks later when the warnings for Frances were issued, Wal-Mart used the information it had gathered when Charlie hit to predict the likely sales of ALL of their items. (It turns out, Floridians really go for beer and Pop-Tarts when a hurricane is coming - go figure!)
Wal-Mart used the information they gathered to ensure that their Florida stores were adequately stocked with the merchandise their customers would want, turning a potential business disruption into an opportunity.
And it's not only Wal-Mart. Wireless phone companies know that if a customer calls their Customer Care Department with the same complaint 3 times within a short period of time, that customer is likely to switch to another carrier (or "churn" to use wireless jargon). There is a predictable correlation between the event and its outcome that allows a company using Predictive Analytics to turn a potential negative into a positive.
Another way companies are using Predictive Analytics is in deciding where to expand retail operations and locate new stores. When presented with multiple choices of available lease space, how to choose the best option is often a challenge.
Using Predictive Analytics, companies evaluate their existing customer base and store data, then combine that with information about household income, age and other lifestyle and demographic data to select the right location for their business.
As you can see, Predictive Analytics can help ANY type of company or organization gain a strong competitive advantage. And while it sounds like it takes an immense IT department and a big budget to utilize this technology, that's not the case.
The best way to launch a Predictive Solution is to partner with a company that can help you get your feet wet, by doing a test with one area of your business. A successful Predictive Analytical Solution starts with a customer focus, so keeping that in mind - work with your partner company to find ways that you can keep existing customers, attract new members or customers to your business or capitalize on a business opportunity your competitors aren't aware of.
Once you experience success in one area of your business with Predictive Analytics, you'll be amazed at how quickly you start to see other uses for this valuable tool throughout other areas of your organization.
If you'd like to know how Predictive Analytics could help you take advantage of unforeseen opportunities, gain new customers and get a competitive edge, give me a call!
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