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Big data must put customers before technology

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Having access to so much data can be daunting – as a business it is important to learn how to use it to your advantage but always remembering to keep the customer at the heart of it, says RICHARD MULLINS, MD of MEA at Acceleration.

Data works in two directions. Firstly, it gives businesses access to unprecedented volumes of real-time data about customer behaviour, preferences and context. It also provides consumers with information about where they should go for the best product range, experience, and pricing.

Thanks to smartphones, consumers have this information at hand whenever they research purchases, shop, and interact with brands.

Consider, for example, someone in a mall looking for the best nearby restaurant. He or she will look up nearby pizzerias on Apple or Google Maps or look up best restaurants on Zomato’s app. This provides the local owner of a pizzeria to target him or her with a contextual ad and perhaps an offer for a complimentary drink.

Think about someone trying on a jacket in a clothing store – having checked out the colour and the fit, he or she may decide to find the cheapest price and order it online. This may be done via their mobile phone, a mobile app or a tablet, for next day delivery. Why not offer to match pricing from the biggest online competitors in a PPC ad when the customer does his or her mobile search on Google?

The trail of behavioural, location, demographic and even psychographic data customers leave behind as they use mobile search and social media enables us to understand consumer behaviour and personalise messaging and right place right offer opportunity. Bear in mind that is aggregated customer data rather than information that identifies them personally.

Personalised experiences
To thrive in a world where smartphones make nearly every shopping experience a digital one, brands must learn to use data across their touch points to deliver a clear and personalised experience to each customer. Luckily, marketers have unprecedented volumes of data that they can use to understand and influence consumer behaviour in real-time.

The problem with trying to wrap one’s head around all this data, however, is that it can be hard to capture, analyse and segment. Most organisations have a plethora of information scattered across numerous logistical, transactional and marketing systems. The marketing systems include the likes of CRM databases, ad-servers, social media platforms, search, third-party data providers and more – and most companies have no idea how to bring it all together to create a single view of the customer. Some large enterprises have been struggling to reach this Holy Grail for decades.

What’s more, in the South African context, data isn’t as big as it is in the US or Europe. Outside a few of the large banks and telcos, most local companies don’t have deep pools of customer data to mine for statistical insight as, for example, Amazon. Lacking the volume of data, they will not achieve the same results as a player with Amazon’s scale even if they apply the same algorithms and analytics tools.

Think smart rather than big
We recommend that marketers ignore the buzz about big data and begin by asking a simple question: “What information will enable us to offer relevant messages and experiences to our customers?” Once they have identified that piece of information, they can begin to think about where and how they can access the data and how they will activate it with the customer.

For us, it’s not about big data. It’s about smart and usable data. Data that enables us to align the right message, service and product with the right customer at the right time. Rather than starting off with a complex data technology solution, marketers should step back and ask: “What data do we need, what data do we have, where does our data sit, and who owns and controls it?”

Understanding the answers to these questions will help the brand create a strategy for accessing the data it needs to serve customers better. Most South African brands have a wealth of transactional data at their fingertips – the next step is to start gathering and leveraging data about the customer context and journey more effectively.

The point is to start with the customers: what do we know about them and how do we serve them better? They should look at specific questions – “We have customers who purchase from us twice a year. How could we entice them to double their purchases?” – and seek equally specific answers.

A focused approach is the key to reaping an investment from customer data.

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Gadget goes to Hollywood

Gadget visited the Netflix studios last week. In the first of a series, ARTHUR GOLDSTUCK talks to CEO Reed Hastings.

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Netflix CEO Reed Hastings is no stranger to Africa. He has travelled throughout South Africa, taught maths in Swaziland for two years with the Peace Corps, and visits close family in Maputo. As a result, he is keenly aware of the South African entertainment and connectivity landscape.

In an exclusive interview at the Netflix studios in Hollywood, Los Angeles, last week, he revealed that Netflix had no intentions of challenging MultiChoice’s dominance of live sports broadcasting on the continent.

“Other firms will do sport and news; we are trying to focus on movies and TV shows,” he said. “There are a lot of areas that are video that we are not doing: sports, news, video gaming, user-generated content. We don’t have live sport.

Reed Hastings at the Netflix studios in Hollywood last week. Pic: ADAM ROSE

“We’re not replacing MultiChoice at all. Their subscriber growth is steady in South Africa. They serve a need that’s independent of the Internet, via low-price satellite. There is no intention of capturing that audience. If they’re growing, it’s because they serve a need.”

While Reed ruled out any collaboration with MultiChoice on its satellite delivery platform, despite its collaboration with another pay-TV service, Sky TV in the United Kingdom, he did not close the door. He stressed that Netflix saw itself as an Internet-based service, and would pursue the opportunities offered by evolving broadband in Africa.

“If you look in other markets like the USA, how Comcast carries us on set-top boxes with their other services, it could happen with MultiChoice, the same as with all the pay-TV providers.

“We’re really focused on being a service over the Internet and not over satellite. Our service doesn’t work on satellite. Where we work with Sky is on Internet-connected devices. We’re happy to work on Internet-connected devices. We tend to work on smart TVs, but need broadband Internet for that.

“Broadband is getting faster in Nigeria, Tanzania, Kenya and South Africa – we can see the positive trendlines – so it’s more likely we will work with broadband Internet companies.”

Hastings is a firm believer in the idea that one content provider’s success does not depend on pushing another down.

“HBO has grown at the same time as we have, so can see our success doesn’t determine their success. What matters is amazing content with which the world falls in love.”

Click here to read on about Hastings’ views on international expansion, and how the streaming service selects content for its platform.

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Take these 5 steps to digital

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By MARK WALKER, Associate Vice President for Sub-Saharan Africa at IDC Middle East, Africa and Turkey.

Digital transformation isn’t a buzz word because it sounds nice and looks good on the business CV. It is fundamental to long-term business success. IDC anticipates that 75% of enterprises will be on the path to digital transformation by 2027. 

However, digital transformation is not a process that ticks a box and moves to the next item on the agenda – it is defined by the organisation’s shift towards a digitally empowered infrastructure and employee. It is an evolution across system, infrastructure, process, individual and leadership and should follow clear pathways to ensure sustainable success.

The nature of the enterprise has changed completely with the influence of digital, cloud and the Fourth Industrial Revolution (4IR), and success is reliant on strategic change.

There is a lot more ownership and transparency throughout the organisation and there is a responsibility that comes with that – employees want access to information, there has to be speed in knowledge, transactions and engagement. To ensure that the organisation evolves alongside digital and demand, it has to follow five very clear pathways to long-term, achievable success.

The first of these is to evaluate where the enterprise sits right now in terms of its digital journey. This will differ by organisation size and industry, as well as its reliance on technology. A smaller organisation that only needs a basic accounting function or the internet for email will have far different considerations to a small organisation that requires high-end technology to manage hedge funds or drive cloud solutions. The same comparisons apply to the enterprise-level organisation. The mining sector will have a completely different sub-set of technology requirements and infrastructure limitations to the retail or finance sectors.

Ultimately, every organisation, regardless of size or industry, is reliant on technology to grow or deliver customer service, but their digital transformation requirements are different. To ensure that investment into artificial intelligence (AI), machine learning, knowledge engines, automation and connectivity are accurately placed within the business and know exactly where the business is going.

The second step is to examine what the business wants to achieve. Again, the goals of the organisation over the long and short term will be entirely sector dependent, but it is essential that it examine what the competitive environment looks like and what influences customer expectations. This understanding will allow for the business to hone its digital requirements accordingly.

The third step is to match expectations to reality. You need to see how you can move your digital transformation strategy forward and what areas require prioritisation, what funding models will support your digital aspirations, and how this tie into what the market wants. Ultimately, every step of the process has to be prioritised to ensure it maps back to where you are and the strategic steps that will take you to where you want to go.

The fourth step is to look at the operational side of the process. This is as critical as any other aspect of the transformation strategy as it maps budget to skills to infrastructure in such a way as to ensure that any project delivers return on investment. Budget and funding are always top of mind when it comes to digital transformation – these are understandably key issues for the business. How will it benefit from the investment? How will it influence the customer experience? What impact will this have on the ongoing bottom line? These questions tie neatly into the fifth step in the process – the feedback loop.

This is often the forgotten step, but it is the most important. The feedback loop is critical to ensuring that the digital transformation process is achieving the right results, that the right metrics are in place, and that the needle is moving in the right direction. It is within this feedback loop that the organisation can consistently refine the process to ensure that it moves to each successive step with the right metrics in place.

There is also one final element that every organisation should have in place throughout its digital evolution. An element that many overlook – engagement. There must be a real desire to change, from the top of the organisation right down to the bottom, and an understanding of what it means to undertake this change and why it is essential. This is why this will be a key discussion at the 2019 IDC South Africa CIO Summit taking place in April this year. With this in place, the five steps to digital transformation will make sense and deliver the right results.

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