Social media has taken communication and interaction to a virtual level with ease. With our smart devices you can browse jobs on Linkedin, skim through your favorite celebrity’s tweet on Twitter, and stay connected with the world. When you post something on social media you are giving hundreds or thousands of people access to your information. Companies have social media presence as well, which allows them to have a more intimate interaction with consumers at a virtual space. This is the front end of things; the back end of social media is even more valuable as it has the ability to provide companies with vital information on consumer taste ad preferences through big data and predictive analytics.
Consumer Data and Marketing
People are reliant on social media today to maintain professional and personal connections. In this process people have given social media companies access to vital information about personal details, either in the form of your country of residence in Facebook, current job on Linkedin or the people you follow on Twitter. In fact if you look at the revenue stream of social media companies, the use of consumer data is catapulting the value of these companies to billion dollar companies. Wonder why Facebook acquired WhatsApp and Instagram- for more data, of course.
Why is consumer data useful?
Consumer data, gathered through social media interactions, is useful in providing details about consumer tastes and preferences. These interactions allow social media websites to provide companies with big data on their targeted consumers. This data collection and analytics is integral for progressive profiling which gathers detailed information in a short time. In this process consumer data also provides key information on segmentation of target market with details like user demographics. All of this data goes through data analytics for predictive analysis in tailoring a relationship with existing consumer. Predictive analysis provides vital information such as customer preferences and potential consumers, all of which are useful in business development.
So what is the big deal?
The customer data gathered while using or becoming a part of any social media platform is an electronic footprint of customer identity and preferences. This information is useful in targeted marketing and is increasing the value of social media companies. Customer data on social media websites is a vital source and solution for customer-brand interaction in a world where the population is growing and companies are inclined to use technology to provide personalized customer service, as mentioned in a previous post which you can find here. Social media through the help of big data collection and analytics has increases the intrinsic value of customer data. Companies can use predictive analytics to track customer behavior on social media and invest in marketing their products accordingly. For example, when you consistently visit a website, they know a lot about you already from the data they’ve collected on you and on their target market. Companies use big data to tailor their product offerings based on your likes and dislikes. So do not be surprised when you’re on Linkedin/ Facebook /Twitter and if a relevant list of “people you may know” or want to follow appears. Now the challenge is that social media companies are always on fire for breaching consumer rights by tracking consumer activity at all times. Will consumers get hesitant in sharing information on social media or will social media continue to shape marketing?