Target raised many eyebrows when it used deep customer data to predict a teen's pregnancy and market maternity products to her (article). They went too far. But the underlying trend is being followed by many large retailers: data is a key cornerstone of marketing and can be used to personalize customer interactions and improve the bottom line.
We don't advocate crossing the privacy line. But when used rationally, data improves the customer experience.
How can small retailers benefit from the big data trend? Given the explosion of smartphone use and proliferation of low cost online services any retailer can become a customer data power house. Let's see how this can be done using Forrester's pragmatic definition of big data:
Store. Can you capture and store the data?
It's easier than ever to capture and store customer data. Mobile apps that offer loyalty, coupons, and deals provide seamless ways to capture customer data. Picking the right method depends on your business objectives and clientele. With ever-increasing cloud storage solutions, it's becoming cheaper to store and manage your data in the cloud.
Process. Can you cleanse, enrich, and analyze the data?
Things get a little bit tricky here, but are still manageable. Processing of the data can take a ton of time (which you don't have much of). Third-party providers do exist and offer a wide range of capabilities to understand the data, provide reports and dashboards, and even the intelligence to recommend what to do with the data. This is a specialized skill but it does exist. The key is to select a provider that can demonstrate understanding of your business, provides exceptional customer service, and is even flexible to adjust their systems based on your needs.
Access. Can you retrieve, search, integrate, and visualize the data?
Here access means use of the data. It should be dead easy to export your customer data (e.g. email list), filter/arragne it, and produce different format of it based on your needs. E.g. pulling customer names and emails based on their birthday should be a snap when you want to send them a birthday special.
Big companies are adopting big data practices in droves, so should you.