One of the impacts of the global health pandemic has been increased consumer reliance on e-commerce. This abundance of online business has generated a wealth of data that can reveal deep insights into customer needs, consumption patterns, and purchasing behaviors.
Of course, to take advantage of this data, you need a way to convert it into actionable, contextual insights. And that’s where machine learning can help.
Machine learning is a data analytics technique that uses algorithms to learn from data. The more data you have, the more it learns. Machine learning can reveal deep insights about your customers and their behaviors. It can help predict sales trends. It can deliver the intel you need to identify and nurture your highest value customers and deliver a more personalized and satisfying experience.
Below, I’ll shed some light on how machine learning can help you transform the data you already have into actionable insights that unlock the full value of your customers and expand your business growth. I’ll also share how Beyondsoft can help you make the most of your data with machine learning.
Enhance user profiling
First, let’s dig into some of the benefits of machine learning. Machine learning makes it easier to reach your target audience through user profiling. User profiling enables you to dial in your marketing efforts by more effectively targeting the right messages and promotions to the right audience at critical points in the buyer’s journey. User profiling can help you tailor products and services to appeal to your most valuable customers.
Machine learning can help you predict customer satisfaction. It can alert you to potential customer churn by highlighting high-risk customers, so you can take proactive measures to counter issues. Machine learning can even reveal a treasure trove of potential customers you never knew about by understanding purchasing behaviors.
Serve up personalized recommendations
As technology advances, customers have increasingly come to expect highly relevant experiences. Machine learning can generate accurate predictions on products customers are likely to be interested in. Large e-commerce companies like Netflix, AirBnB, and Amazon already leverage machine learning to do this. In fact, you’ve likely come across recommendations such as, “Customers who shopped for Green Eggs and Ham, also shopped for The Cat in the Hat and Fox in Socks.”
Additionally, machine learning can equip you to deliver dynamic pricing to customers. So rather than offering the same deep discount to everyone, machine learning enables you to discount a product just enough to close a sale. Machine learning can help you generate more effective offers by accurately predicting a customer’s response to a promotion. It can even help generate new opportunities by upselling products and services, such as an extended warranty for a new monitor or a scarf to go with that new parka.
Forecast with greater accuracy
Finally, when it comes to forecasting, machine learning gives you as close to a crystal ball as you can get. Increased forecasting accuracy driven by machine learning gives you the ability to make more informed business decisions and take proactive measures to keep your business humming along at optimal levels. By transforming historical data and user information into accurate predictions around business and personal consumption, it can accurately forecast future sales. It can also predict inventory and supply chain fluctuations, so you can keep your shelves stocked.
A premium cruise line in Seattle
To give you a little context, here are a couple examples of how machine learning has helped our clients accelerate business. This first client – a Seattle-based premium cruise line – leveraged machine learning to identify and learn the patterns of its most valuable customers, increasing accuracy from 34% to 80%. By gaining deep insights into the preferences and consumption patterns of their passengers, they were able to achieve highly accurate and meaningful customer segmentation.
The cruise line also gained intel from behavior-backed analytics on the profitability of amenities such as photos, spa services, casino, bar, and shore excursions. By applying learnings around factors such as ticket price, booking date, age, number of passengers, loyalty, and trip length, the client was able to make informed pricing changes that increased revenue and as well as their success at upselling new services to customers with similar profiles and consumption behaviors.
A leading low-cost airline
For low-cost airlines, 90% of their revenue comes from the purchase of additional items such as checked bags, upgraded seats, VIP lines, and onboard meals. Therefore, it is critical for the airline to successfully upsell these products. By applying machine learning to purchasing behavior patterns, our client was able to identify passengers most likely to make these purchases. This insight enabled highly targeted campaigns, promotions, and dynamic pricing to increase sales.
Our client also found hidden customers by discovering patterns and trends such as destination, number of connections, and passenger demographics. Combined with dynamic pricing, marketing to these newly found prospects became more effective. The accuracy of the predictions for the top 3.5% of their passengers reached 60%. And the time needed to compute millions of predictions took less than one minute.
Get started with machine learning with a free consultation
These are just a couple of the many e-commerce clients Beyondsoft has helped with Machine Learning as a Service (MLaaS). We can help you as well. Our data scientists will analyze your existing data to determine how machine learning can be applied to deliver predictive insights that can help you achieve your business objectives.
Our cloud-based managed service features initial workflow set up, ongoing support, data ingestion and normalization as well as the creation of interactive dashboards. We take care of your data processing needs from preparing the data to updating data types for modeling to training machine learning models to publishing real-time insights and visualizations.
To learn how you can get started, contact us for a free consultation.