Have you ever burnt your tongue while having hot soup when you were young? If you have, then you now use the understanding obtained from that experience to predict what will happen if you accidently taste the hot soup. Also, you very well know how to prevent such an experience.
How AI and Data Science solve the biggest business challenges of today
- An Overview on Data Science and Artificial Intelligence
- Why every business needs Data Science and AI
- Business cases for varied industries
- Roadmap for implementation
Likewise, predictive analytics do the same thing for your business. It utilizes your data to make connections related to the past experience, and it makes use of this information to predict what may affect your company in the future. The results of using predictive analytics can be amazing, and many business leaders are coming around to the view that it is an indispensable solution to stay ahead of the market competition.
Smart selling, fueled by technologies like predictive analytics, is expected to jump by 77% among high performers throughout 2016 – Salesforce Research
5 Things that predictive analytics can do for your business
Some industries that use predictive analytics to optimize their operations and multiply revenue.
Finance & banking: Identify and decrease fraud, run effective marketing campaigns, measure credit risk, maximize cross-sell/up-sell opportunities, and retain customers.
Manufacturing: Recognize factors that lead to poor quality and production failures, and improve parts, service resources and distribution.
Insurance: Decide insurance premium rates, find out claims fraud, plan out better claims processes, retain customers, increase profitability and optimize marketing campaigns.
Oil & natural gas: Forecast equipment failures and future resource requirements, lessen safety and reliability risks, and increase performance
Retail: Assess the success of promotional events and campaigns, predict which offers are most suitable for consumers, decide which products to stock where and how to develop brand loyalty.
Healthcare: Predict the effectiveness of new procedures, medications, and medical tests, and improve services or results by providing cautious and effective patient care.
Here are the six reasons why your business needs predictive analytics
To stay ahead of your competitors
Predictive analytics helps you in taking advantage of your company’s strengths and competitors’ weaknesses. By selecting the data surrounding your company’s experience, you get insights unique to how you perform. Such insights are not trivial; in fact, they give detailed information on how you are successful and where your organization’s individual advantage exists.
On the other hand, predictive analytics provides you an evaluation of the activities of consumers who have been exposed to not only yours but also your competitors’ marketing plans. This modeling process distinguishes between customers who chose you versus those who chose your competitor, finding out what were the factors involved in their decision.
To boost sales and retain customers
Predictive analytics gives your company the information that is needed to target customers with the right message at the right time. By predictively analyzing customers, based on their next probable action whether it will be a purchase or churn, you can more practically plan and spend your dollars on messaging them.
Cut costs on your marketing messages and increase the rate of response by compelling those who are doubtful to respond based on their predictive rating. At that time, you can offer discount codes only to those who are about to leave and save the cost of handing out to a broader audience.
To maintain business integrity by handling fraud
It is humanly possible for fraud investigators to inspect only a certain number of cases each month. With predictive analytics, you can use your company’s past experience with fraud cases to gauge transactions according to their level of risk. To elaborate, if you narrow the number of potential fraud cases precisely, then the investigator’s time will be optimally spent on solving fraud cases instead spending time on false positives.
To improve your business core competencies
The next step to progress apart from increased sales is to enhance your company’s core offering and the way they are delivered. This may mean different things across different industries, but basically, they all focus on one thing – using predictive analytics to optimize their approach to marketing.
To meet ever-increasing expectations of modern consumers
If you have ever received an email from a company that isn’t relevant to you, then undoubtedly you must have felt frustrated. From this instance, you can understand the advantage that predictive analytics brings to consumers.
Uninvited and irrelevant communications are not liked by consumers; instead, they prefer personalized communication. Moreover, predictive analytics also takes care of consumer security expectations, strengthening security while triggering fewer false alarms. With a positive customer experience facilitated by predictive analytics, your business can make way for a rising and loyal customer base.
To not just evaluate the past, but also learn from it
When using analytics to assess your company’s performance, most standard methods will sum up past success or failure. But predictive analytics can create learning from previous experiences, understanding mathematical trends and patterns among your data and using them to anticipate unexpected and future possibilities. The capability to integrate social data and unstructured text provides a profound knowledge of how consumers engage with and impact others in their social connections, creating the opportunity to predict churn or prospective customers based on historical data.
In a nutshell
Without a shadow of doubt predictive analytics can take things a level ahead by providing valuable insights to decision-makers for designing the next action. So, if you wish to see how predictive analytics can help your business in taking wise decisions contact our predictive analytic experts.