When large companies ($1 Billion +) focus on improving customer experience, a lift in revenues is seen through additional customer purchases, reduced churn and business from recommendations, according to a recent study. One critical way for companies to improve customer experience is to capture and adhere to customer’s permissions and preferences. In other words, develop a strategy around “Small Data” and leverage it to meet and exceed customer expectations.
So what is Small Data? In a newly released whitepaper, Realizing the BIG Value of “Small Data,” Consumer Centric Strategy, Inc. defines Small Data as follows:
Facts, permissions, and/or preferences expressly provided by an individual to a business during the course of the customers’ Path to Purchase and Loyalty Lifecycle.
According to the Consumer Centric Strategy white paper, if Big Data is at the bottom of the customer data pyramid, then Small Data is at the top. Big Data includes Demographic data, Attitudinal data and Transactional data. Profile and Permissions data is in the middle of pyramid, straddling the line between Big and Small Data. Customer Preferences, Needs and Desires are the heart of Small Data. The business value of each type of data increases as we move to the top of pyramid, with Needs and Desires having the highest business value and the biggest potential to help exceed customer expectations.
Small Data starts with Customer Profiles, acting as the foundation for Permissions and Preferences. It’s important to ensure that Customer Profiles are accurately assembled with various attributes that uniquely identify each customer, including data such as postal and email addresses, phone number, web and social accounts, and are frequently updated.
Permissions data – the customer’s consent to be contacted – should be layered onto profile data and strictly adhered to. According to the whitepaper, “the most effective communication occurs between mutually interested, actively engaged and fully consenting parties.” By communicating outside of the permissions granted by the consumer, the consumer will almost certainly tune you out.
Preferences tell companies the right way to engage with a customer, addressing the critical questions of How, When, How Often to communicate and What to communicate about (products, birthdays, special events, features, etc.).
While Small Data may not seem as daunting as Big Data, Small Data can be extremely powerful and valuable if properly assembled and updated. Enterprise Preference Management is the active collection, maintenance and distribution of Small Data points. These data points have been expressly stated by the consumer themselves and include product interests, communication channel preferences and frequency of communication. “Enterprise” is of critical denotation here, since an effective preference management system needs to encompass all communication channels, departments, customer databases and tracking/reporting activities.
To learn more about the importance of Small Data and the business case for Enterprise Preference Management ecosystems, read Realizing the BIG Value of “Small Data” – sponsored by PossibleNOW and written by Consumer Centric Strategy’s CEO Gregg Aamoth.