Consumer behavior is evolving at lightning speed—at least that’s what the data seems to suggest. But let’s face it, brands and businesses are so perplexed by data these days that it’s hard to know what’s really happening. Nevertheless, companies are ready to adjust their business strategies to keep up. New research from privacy-led data intelligence firm Near Intelligence reveals how those behavior changes are impacting strategy.
The firm’s new State of Global Consumer Behavior Data survey, conducted in partnership with Hanover Research, finds that 60 percent of data and operations leaders surveyed said that changes in consumer behavior have caused their organization to rethink its business strategy in the past year, while 70 percent are worried about the economic impact of a potential recession.
“Consumer behavior data has become increasingly valuable in driving business decisions and is being utilized across a wide range of use cases,” said Anil Mathews, CEO of Near, in a news release. “From visitor insights and customer profiles to competitive intelligence and inventory planning, data is proving vital to businesses’ success. Additionally, consumer behavior data provides valuable insights into shopping trends, eating habits, and travel patterns, among others.”
The report examines the ways in which consumer behavior data is used to make business decisions to address challenges and assess sentiment about the state of the industry. “Without a steady stream of up-to-date data on consumer behavior, companies are essentially flying blind,” said Steven Williams, chief research officer at Hanover Research, in the release.
Leveraging consumer data to stay ahead of the competition
The survey findings suggest that companies recognize the value of consumer behavior data and are looking for ways to leverage it to stay ahead of the competition. However, executives also indicated they would like to have more data available to them:
- 77.5 percent agree that consumer behavior data is critical for making informed business decisions.
- However, 72.1 percent of executives also indicate that they would like to have more data available to them for business decisions.
- 56.7 percent of organizations plan to increase their use of consumer behavior data for decision-making in the coming year.
Data still not utilized for decision-making
Despite the importance of data for business decisions, many teams still struggle to use it effectively. According to survey results:
- The majority of executives, or 64.2 percent, believe their organization is doing better than competitors in using data for decision-making.
- 38.9 percent of respondents report their organization has a lot of data, but isn’t effective in using it to make informed decisions.
- Nearly 40 percent of data executives say they have missed business opportunities due to insufficient data.
Hurdles to utilizing data
The top hurdles to using consumer behavior data for decision-making include:
- Finding high-quality data sources (34 percent)
- Blending data (32.5 percent)
- Making data actionable (27.7 percent)
- Ensuring privacy compliance (26.5 percent)
- Visualizing data (24.3 percent)
Although most organizations have a chief data officer or similar role, nearly a third of data executives said their organization does not have one, and 64 percent of data executives said they would like more technical expertise on their team so they can better utilize data.
Data security and accuracy remain top concerns
Data security and data accuracy are two key concerns that many data executives share.
- The majority of respondents, or 78 percent, agreed that data security and avoiding data breaches is a top priority for their organizations.
- Additionally, 94.4 percent expressed a level of concern about poor or unreliable data quality.
When researching third-party data sources, data security (69.2 percent) and data accuracy (63.8 percent) are the top features and functionality that executives look for. However, these two features are also the most challenging to find in third-party data sources.
Still room for improved transparency
Transparency around privacy is also important to executives, but many state that there’s still room for improvement.
- 92.7 percent of executives expressed some level of concern around adherence to privacy regulations.
- 66.8 percent are confident that their organization is complying with all data privacy regulations in the regions where they operate.
- 70.9 percent feel confident that their organization is transparent with the way they collect and use consumer data.
Consumer data integral to planning for 2023 and beyond
According to the survey, over half, or 56.7 percent, of organizations plan to use more consumer behavior data for decision-making in 2023. To achieve their goals, businesses are focusing on a range of areas, including:
- Growing footfall to locations (53.7 percent)
- Improving customer experience (52.0 percent)
- Online visits and sales (47.1 percent)
- Optimizing staffing (37.1 percent)
- Inventory turnover (35.5 percent)
To achieve these goals, businesses plan to:
- Get more teams involved in using data for decision-making (47.4 percent)
- Use data for additional use cases (43.2 percent)
- Do more to integrate siloed data across departments (40.4 percent)
- Integrate consumer behavior data with additional sources of third-party data (38.0 percent)
Near partnered with Hanover Research to survey 590 global data and operational leaders working in the retail, restaurant, commercial real estate, and travel & hospitality industries.