You wouldn’t be wrong if you think so; there are other primary factors that add up. However, looking at the businesses cycle in the 21st century, one of the biggest competitive advantage that businesses have is data. These data are fundamentally gotten directly from customers while the more private information are sometimes bought (you may not really know that).
These data are used meaningfully to better customer experience in business; the more sensitive the data, the more businesses can satisfy their clients better. No wonder many of the big establishments adopt data driven innovations. This is evident in financial institutions, social media, phone companies, accessory industries and the likes. If you did an undergraduate project research in business administration or management, you will get to understand what data means in business especially if you did a research on data and business related topics. That notwithstanding;
Why do businesses need such big data?
Understand customer preferences
Compiling and analyzing data allows organizations to classify their customer needs and preferences based on demographics like age, gender, status, religion etc. and psychographics like attitude, value system, fears, emotions, perception and the likes. So they can actually determine the kind of products or services you may like without actually asking you. They get to know from the information they have about you.
Know your target audience
You are certainly beckoning on failure if you don’t know who your business is really meant to satisfy. This is so serious that you may likely not know what size of clothes to buy if you are a clothe dealer. You may not be certain about the kind of technology to adopt if you don’t understand the use if you are into a tech related business. Know your audience and know their need.
Predict customer needs
If you have such big data at your disposal in business, you are capable of predicting what your customers would like and win the heart of clients easily; they will suppose you are trendy. Sometimes businesses test their customer reactions with product or service samples. The outcome actually determines if they will go further in that innovation or not. Sometimes they let prospective client spell out what they wished was available in that business sphere; that’s actually the best way data is used for optimal result in businesses.