5 Things Small Businesses Should Do Better With Data
Is Big Data only for big business? Not anymore. Here are five ways the CEO of Swipely says smaller ventures should analyze data.
Imagine you're waiting at the checkout in a store. The customers in front of you represent a lot of things: sales, maybe a mild annoyance for you if the line is long, and finally, a heck of a lot of information.
That last piece of the puzzle--customer data--can be the most important, but it's also underappreciated. Although big online companies track just about everything their customers do, smaller brick-and-mortar ventures are often far behind the curve.
I talked recently with Angus Davis, founder of Swipely, a Rhode Island company that's trying to take advantage of that opportunity.
Swipely offers payment processing for small businesses, with a focus on collecting and analyzing customer data so its users can improve their operations and marketing. I'll admit that I was originally interested in the company because I grew up in Rhode Island, which isn't exactly known as a modern tech or startup hub. In fact, Rhode Island has perennially had the worst unemployment rate in the country.
Swipely, however, is a success story. The company was reportedly the first Rhode Island software company to raise a Series A venture capital round and grew from 30 employees a year ago to about 90 today.
"The idea is that the payment network moves money but doesn't glean data well," Davis said. "Our technology enables people not only to accept payment but access powerful analytics about customers."
Swipely focuses on smaller businesses, and Davis told me that two-thirds of its customers are restaurants (including chains such as Rosa Mexicano and Fig & Olive).
Here are the five things Davis thinks companies are able to do more effectively than their competitors through tracking customer data:
1. Know your customers better than their mothers do.
The key here is to identify your 100 best customers, keep track of what they love to order, and make sure you know how often they visit. Then use that knowledge to make them feel special. Marketing experts suggest that developing 100 fiercely loyal customers can drive more word of mouth than a $25,000 advertising campaign.
2. Evaluate your marketing efforts.
There's an old saying that 90 percent of advertising doesn't work, but the trick is that it's so hard to know which 10 percent is actually effective. If you can track how many of your sales in any given time period come from new customers, as opposed to repeat visitors, you'll understand more quickly whether your marketing efforts are working.
3. Spot hidden items that will unlock new sales.
There is often a trove of data that's hard to find without the right tools. If you're running a restaurant, is there one menu item in particular that new customers come in to try? Identify it, and you'll see which hidden gems you can coach your staff to recommend to first-time guests.
4. Help your employees to become better salespeople.
You can effectively track who on your staff sells the most and drill down deeper to see who turns over tables most often or persuades customers to purchase particular menu items. Figure out who your stars are, and you'll know where to focus your coaching efforts.
5. Collect feedback without lifting a finger.
Let's use the restaurant industry as an example some more. Nearly half of restaurant reviews mention specific menu items, which means there's another rich data source to mine. Listening to what customers have to say about your business on sites such as Yelp, OpenTable, Google, and TripAdvisor gives you a quick way to offer concrete feedback to your chef, servers, and marketers.