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Owning your customer data is the key to profitability. This is why.

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Gone are the days of blindly marketing to consumers and guessing what people want. Today, consistent communication with customers is critical when it comes to a thriving business. By owning your customer data, you can drive sales, save time, money, and build stronger customer relationships.

This proved especially useful during Covid-19, when restaurants and hotels had to rotate and distribute updates, offers and incentives to maintain revenue through direct outreach. Even in times of uncertainty, the ability to communicate effectively with customers depends on solid data.

Despite the benefit of owning consumer data, many companies still rely on third parties. If you consider that, then part of the conversation becomes: discuss the disadvantages relying on third-party data ownership and why capturing proprietary customer data not only saves money, but also improves business outcomes.

Related: 5 creative ways consumer data can quickly scale your business

The importance and significance of data in today’s business

Today, a majority of consumers expect a more personalized approach to communication and recommendations. With that in mind, custom SMS (Short Message Service) marketing, digital signage, and other targeted messaging have a direct impact on return on investment (ROI). The beauty of collecting consumer data is that it allows companies to collect valuable information and then deliver hyper-targeted messages to people based on their specific buying habits and preferences – which then lends itself to more business opportunities and helps maximize the earning potential of each. maximize customer.

Just look at Amazon as an example of effective use of consumer data. From the earliest daysCollecting its consumers’ data, Amazon was able to determine how customers browse for products, what was added to their customers’ shopping carts, and the ways people moved from A to B on their website.

Such data collection practices have largely contributed to Amazon’s scalability and becoming the power it is today, as it allows them to personalize the experience for each user based on their consumer data. In addition, the priority Amazon has given to its consumer data is now mirrored by most of the current successful companies. In fact, research by McKinsey & Company revealed that organizations with the fastest revenue growth rates were much more likely to engage and prioritize consumer experience personalization.

Related: If your business isn’t customer-obsessed, you’re doing it wrong

Importance of data for physical and catering

A often referenced article came out a few years ago The economist, which stated that oil was no longer the world’s most valuable resource and that it was now basically data. When we think about the power of data and how it enables businesses, especially those in the hospitality industry, to acquire new customers or increase the loyalty of current customers, there is a lot of truth about the indispensability of data.

Collecting relevant consumer data is an essential resource for the hospitality industry and brick-and-mortar stores. The reach and impact of data improves business operations, customer experiences, resource optimization and trend adoption. It can also turn an infrequent guest into a regular at restaurants and convert single item buyers in stores into valued and frequent buyers of multiple items with each visit.

Take for example our customer Mellow Mushroom: their franchise in Central Florida leveraged integrated Wi-Fi marketing to grow its customer database by 35% year over year. They ran promotions and filtered data from each location to create unique, automated greetings with a link to that respective Facebook page. The automation was a real game-changer – but it depended on the ability to capture and own consumer data.

For hotels, restaurants and any other type of business, preserving the loyalty of existing customers and extending reach to new target markets means long-term success and competitive advantage – making the effective collection and interpretation of customer data a priority for the entire economic ecosystem .

Related: Is customer data privacy really important? It should be.

Why you should collect and own your consumer data?

Privacy is a primary concern for customers when it comes to the security of their data and information. The Harvard Business Review made an excellent point that while these fears exist, a great way to counter them is to demonstrate the value and purposeful results that effective data-driven communication provides.

The article went on to say that a company can use data to provide consumers with more compelling results that are more responsive to what is most likely to spark joy. This fosters a mutually beneficial relationship where both the consumer and the business can thrive and build a positive long-term relationship.

It is important to make the customer feel and understand that it is their data, and that they are still in control of it. Businesses need to make it a critical step towards data governance so that the customer always feels like they can delete their data, see what you know about them, and therefore build trust that you (as the “owner” of the data) will always be able to rely on. aware of consumer concerns.

By being directly involved in how data is collected from your consumers, you can ensure the privacy, security, quality and validity of the data collected. Outsourcing to a third party can impact the quality of customer data, but more importantly, so does the privacy of that data — all of which contribute to bottom line and can help or harm a company to create effective data-driven outcomes. Considering that the data set compiled by a third-party company may be of lower quality and may also be sold to your competitors and other adversaries, why would you do that?

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