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Customer Analytics Powerpoint

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Customer Analytics Powerpoint

  1. 1. Customer Analytics ShopSense – IFA Partnership Paul Apostolakis Joseph Simonetti Tushar Batra
  2. 2. The Case  An insurance company IFA finds interesting results through correlation studies.  This data has to be acquired through a grocery chain ShopSense  How can both the companies leverage data responsibly? Should ShopSense sell its data from their rewards program to IFA?
  3. 3. Customer Analytics  Customer analytics is a process by which data from customer behavior is used to help make key business decisions via market segmentation and predictive analytics  It helps to predict a customers buying pattern, it can reveal information about customers taste and preferences  This data is gathered by ShopSense, and it can be valuable to IFA
  4. 4. Value Created with Data  IFA can analyze the data bought from ShopSense to screen high risk clients based on their shopping habits  It can extend discounts to clients that they consider low-risk  Is this data accurate to make these predictions? Correlation does not imply causation
  5. 5. Should ShopSense and IFA enter into a Partnership ?  Advantages from selling out  If ShopSense provides their tapes to IFA they would receive a million dollars of pure profit annually  Disadvantages  This deal is not without any risks. There are many concerns for ShopSense to sell their data.
  6. 6. Argument against entering into partnership with IFA  The primary concern for retailers is to ensure customer satisfaction and extend their customer base and maintain their loyalty  Selling client data to IFA could result in  Damaged relationship with existing customers  Customers opt out of loyalty programs  Risk of consumer backlash is high for ShopSense
  7. 7. Ethical Concerns  The information gathered should be considered personal; therefore, it is not ethical to sell this information or buy this information. Also, an ethical issue arises from deciding prices for personal information.  Customers may not know that ShopSense is providing Data to a health insurance company, and their shopping history is being used to determine the premium they pay
  8. 8. Customer Privacy  Consumers do not know where these records are and they cannot be checked for accuracy  Changing the data if inaccurate is difficult, if not impossible  Consumers do not know how this data is used and what circumstances it will be used for  Security of this information cannot be guaranteed, and may be easily accessed by unauthorized people
  9. 9. Threats and Securities  The wirelessly networked business environment creates a high risk to information security  Smaller, faster, and cheaper computers allows an increase in stealing or losing data from people. The skills necessary to hack computers are decreasing  There is an increase in employee use of unmanaged devices, which increases threats to information ShopSense will have to bear the cost of protecting client data
  10. 10. What about Corporate Culture?  Employees at ShopSense maybe uncomfortable and may have ethical concerns with the business practices  Corporate culture will suffer
  11. 11. Conclusion  ShopSense should not enter into a information sharing partnership with IFA because the only gain they receive would be a million dollars in profit, but the risks involved are high
  12. 12. Conclusion (continued)  ShopSense sales will decrease when customers realize that their data is being sold to IFA  Threatens future growth prospects of ShopSense  Threatens current market standing  Corporate culture will suffer  In the world of retail loyalty is hard to win; Customer data needs to be protected

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