Zero-Party Data

Using Real World Data for Timely Recommendations

Companies should use real-world data to help them communicate with their customers and make the right recommendations at the right time. Doing so will help both in the short term and the long run.

It wasn’t that long ago that you were driving in your car and a light would appear on your dashboard. That light would indicate that there was some issue but it wouldn’t provide many details. So you would have to lug out the owner’s manual, flip to the back, and find out what the heck it meant. If you completed that step and found out you needed oil, you’d then probably say that you’d get to it at some point but there was no sense of urgency.
Fast forward to today. Now when you’re driving, your car dashboard will light up alerting you specifically that your oil life is at 20%. Then, if no corrective action is taken, it will remind you when it is at 15%, and then 10%. Not sure what happens after that because the continuous prompting and urgency always motivates me to change my oil. Car manufacturers have learned to leverage technology and quantify alerts that educate and communicate with their customers. ‍
How Brands Can Communicate
It’s time other physical goods companies do the same.
But how?
First, physical goods brands (and by physical goods I mean companies that sell a physical product like a musical instrument, a pet, a consumable) need to regain a direct relationship with their customer. We talked about this at length in a previous blog so I won’t go into too much detail here. However, this step is crucial because you can’t communicate directly with your customers if you have no relationship.
After you have a relationship, you will need a way to communicate with your customers. Communication is most effective when it is bi-lateral so it makes sense that this step would have two parts. First, you need a mobile app so that your customers have a centralized location they can go to find the latest and greatest information from your brand.
Many brands stop there, which is coming up short. On the brand’s side, they need to have a product experience platform that allows them to enter in the milestones specific to the product their customer purchased so they can systematically alert, educate and recommend to their customers. ‍
Keeping up with Nemo
Let me break that down a bit. Say your customer purchased a fish, let’s call him Nemo, from one of your pet stores. While this customer previously owned a cat or a dog, this is the first fish she’s ever had. She is excited! She bought the tank and the food and she’s  ready to watch Nemo swim around for hours! But taking care of a fish is much different than taking care of her cat. The water needs to be changed on a certain schedule, the temperature can’t get too warm, food amounts vary as the fish grows.
Fortunately, you care about after-sale customer engagement and are using a product experience platform. You’ve pre-loaded vital information into that platform so that your customer can be educated and alerted as she onboards, enjoys and maintains her relationship with Nemo. Nice job!‍
Right Time, Right Recommendation
While this level of communicating would be a huge step in the right direction for physical goods companies like yours, it isn’t enough anymore. The key is to make the right recommendation at the right time. That is how you increase your conversion rate. That is how you build brand loyalty.
But how does a physical goods company do that?
Whether your product is a pet, a musical instrument or a consumable, companies need to begin collecting real-world-data. Real-world-data is simply data that is gathered after the sale and is specific to the customer’s experience. Real-world-data could come from IoT sensors connected to the device that collect aggregate usage, environment and performance analytics. Or it could be from inquiries you ask of your customers (how are you feeling today?). Or it could even be traditional methods like a net promoter score. Of course, all of this emphasizes the need to have a relationship with your customers.
When you have real-world-data, you’ll be able to understand your customer’s reality. Knowing that means you’ll be able to provide the right value at the right time.
Let’s go back to Nemo. If Nemo dies within the first few months, your customer is very unlikely to buy another fish. This would be considered churn. You are very motivated to help your customer keep Nemo around for a couple of reasons. One, because she will find great joy and love from Nemo. And secondly, because she’ll be more likely to buy another fish in the future. That’s good business.
Over time, Nemo requires careful ongoing controls of living conditions or he could die, and his aquariums could end up in a landfill. Again, fortunately for your customer, you believe in real-world-data and so the sensor on Nemo’s tank is letting you know the temperature. If the water is getting too hot, which could jeopardize Nemo’s well-being, you can alert your customer to this fact and offer guidance on how to remedy it. Maybe, you also sell a product that helps keep tanks cooler. You can alert your customer about that product, educate on it and have her purchase it all through your mobile app. Hallelujah, Nemo lives!
Being proactive and timely will drive additional revenue in the short term by providing a quick sale that solves an immediate problem but, what is even more important, is that it will drive long term revenue by building a stronger relationship with your customers.‍

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