Data drives business decisions. Businesses can use data to improve product or service features, price products better, market to the right demographic, and even navigate a recession. The data that your business collects can help your business stay afloat during an economic downturn in several ways.
1. Increase Sales by Understanding Buyer Behavior
Knowing your buyers’ behavior can help you better promote your products and make sales during a recession. Key data can be collected and used to understand when buyers purchase on a customer-by-customer basis.
Buying habits often change during economic hardships, but you can use buyer behavior to:
- Promote to buyers strategically during the week or month to increase sales
- Send discounts to buyers that routinely use your product or service
The data you collect from buyers can also be used to improve the customer experience. You can leverage the data you have to learn what products or services that your business can market to individuals and businesses.
Buyer behavior is a key component of marketing. Businesses can utilize behavior data to increase sales and boost conversions.
2. Data to Reduce Overhead
Most businesses will experience a sales lull during a recession, and you may have to make hard decisions on which products or services to drop or market. Smart data can be a powerful tool in reducing expenses.
Data can be used in numerous ways to reduce costs outside of products and services.
You can use data to:
- Reduce employee churn. When hiring, advanced analytics can reduce employee churn, which costs companies $15,000 on average. Before and during a recession, data can help you maintain employees and boost satisfaction.
- Reduce inventory costs. Maintaining high levels of inventory reduces cash flow. Through analytics and historical data analysis, you’ll be able to better reduce inventory costs.
- Reduce utilities. Data may allow you to cut back on utility costs. Company mobile phone policies may be adjusted if there are fewer workers out in the field, or energy inefficiencies can be analyzed and corrected to reduce warehouse heating and cooling.
You can also use predictive analytics to better understand if renting or buying equipment is the best option, or to determine if outsourcing may be beneficial.
The data you collect and analyze can be used for cash flow forecasting, too. You can use forecasting to better understand:
- Where income is coming in
- How you’re spending money
- How to cut back on unnecessary expenses
3. Design Products to Better Fit Customer Needs
When customers are dealing with financial issues, they purchase products and services they deem more valuable than others. Your business should use analytics, surveys and data to design products or services that:
- Fit into multiple budgets and price ranges
- Fulfill a customer’s needs in new and different ways
You may find that, based on data, you’re missing out on customers that need your service but don’t have the budget for it. Reducing your costs for a premium product or service isn’t ideal because you may have customers switch to your lower-cost options, but you can develop new service or product tiers aimed at different budgets.
Customer needs must be considered because an integral business will continue to make sales even during a recession.
The right data and analytics will help you better design products and services that can withstand a recession. You may even find different pricing models or subscriptions that would work best for your customers based on the data you collect.
Data can help your business navigate a recession, but the data is only valuable when you can analyze and dissect it. When you routinely collect, analyze, and take action based on data, you’ll be able to better navigate current and future recessions.
Contact us today to learn how we can help you make sense of your data.