Predictive analytics uses models based on comprehensive data sets to predict future results. Many businesses can benefit from using predictive analytics because it allows you to better understand your customers and predict their purchasing behavior. Your business can incorporate predictive analytics into your sales and marketing strategies to generate a higher volume of high quality leads. Here are a few ways you can use predictive analytics to benefit your business:
- Estimate Customer Lifetime Value (CLV)
With predictive analytics models, you can estimate how much each new customer might be worth in the future. Will they return to make another purchase? Based on data from consumers with similar profiles and behavior, you can provide an educated answer for this question. You can also predict whether a customer is likely to bail on a contract. Then, if you think your new customer is likely to leave, you can make it worth their while to stay.
- Optimize Digital Ads
You can also use this data to study the behavior patterns of your target audience. By following their online activities, you can optimize your digital ads to target them and similar consumers.
- Assign Accurate Lead Scores
With customer relationship management (CRM) software, lead scoring is already widely used to determine the quality of each lead. Combining CRM and predictive analytics will let you assign even more accurate lead scores to your contacts.
- Make Recommendations
Just as Netflix will make recommendations based on your past viewing choices, you can recommend other products and services to your customers based on their past behavior. With predictive analytics, you can anticipate what your consumers might be interested in purchasing next.
- Anticipate Inventory Needs
When you have an accurate idea of what your consumers purchasing behavior will be in the coming months, you can save money by eliminating unnecessary inventory and only buying what you need.
Incorporating predictive analytics into your marketing and sales strategies is easier than you think. First, you need to start collecting accurate data using tools such as CRM systems. Then, you can implement predictive analytics with your CRM software and various integrations. If you’re not sure which CRM system or integrations will work best for you and your business, feel free to contact us!