02 March 2023
Five Ways Brands Can Use Predictive Analytics to Accelerate Growth in 2023
How B2B and B2C businesses can improve productivity
by AJ Bellarosa
In today’s highly competitive business landscape, brands need to stay ahead of the curve to acquire customers, retain them, and accelerate revenue growth. With the help of predictive analytics, brands can make data-driven decisions that help them accelerate growth. Predictive analytics uses data, statistical algorithms, and machine learning techniques to identify the likelihood of future outcomes based on historical data and analytics.
Here are five ways B2C and B2B brands can use predictive analytics to accelerate growth in 2023.
Predictive Marketing
1. One of the most effective ways to drive growth is through predictive marketing. This year, marketers are focused on accelerating the time required to act on insights; predictive marketing is a great way to do that. Brands can use predictive analytics to segment customers into groups based on their behaviors, preferences, and purchase history. By doing so, they can create highly targeted campaigns that resonate with their audience. Predictive analytics can also help brands optimize their messaging and content to increase engagement and conversion rates. This can lead to increased customer loyalty, higher customer lifetime value, and increased revenue.
B2C brands can use predictive analytics to analyze the behavior of customers who have purchased a particular product. They can then use this data to create targeted email campaigns that offer complementary products or services to those customers. They could also cross-sell or upsell those customers based on related products that complement other products they have purchased in the past. This intelligent and personalized approach can increase the likelihood of a customer making a purchase and also improve retention and brand advocacy.
B2B brands can use predictive analytics to improve sales velocity by predicting lead behaviors at specific stages in the buying process. Marketing can use sophisticated algorithms and AI to automate workflows and arm their sales team with the right content at the right buying stage to improve conversion rates.
Inventory Management
2. Predictive analytics can also be used to optimize inventory management. Businesses are redefining inventory management practices in an effort to combat declining growth in 2023. Brands can use predictive algorithms to forecast demand for their products and optimize their inventory levels accordingly. By doing so, they can reduce the risk of stockouts and overstocking, leading to increased costs and decreased sales.
A B2C retailer can use predictive analytics to analyze historical sales data to identify seasonal trends and predict demand for certain products during specific times of the year. Predicting demand can help the retailer stock up on these products ahead of time, reducing the likelihood of stockouts and increasing revenue.
A B2B wholesaler can use predictive analytics to proactively manage orders for their buyers. By using predictive analytics for order and inventory management, wholesalers can optimize the supply chain by anticipating their buyer’s needs and providing the products their customers need at the right time.
Customer Churn
3. Customer churn is a significant challenge for many brands. In fact, customer churn costs brands approximately $168 billion annually. Predictive analytics can help brands identify customers who are at risk of churning by analyzing their behaviors, purchase history, and other relevant data. By doing so, brands can take proactive measures to retain those customers, grow their relationship with them, and prevent them from leaving.
A B2C subscription-based business can use predictive analytics to analyze the behavior of customers who have canceled their subscriptions in the past. They can then use this data to identify customers who are at risk of canceling and offer them customized incentives to encourage them to continue their subscriptions.
A B2B software as a service company can use predictive analytics to manage their annual contracts with customers and make recommendations to their sales team on what products and solutions to upsell. Not only does this improve customer retention and lifetime value, but it also increases sales productivity.
Fraud Detection
4. Fraud is a significant problem for many businesses, particularly those in the financial services industry. According to estimates, e-commerce losses to online payment fraud were estimated at 41 billion U.S. dollars globally in 2022, up from the previous year. The figure is expected to grow further to 48 billion US dollars by 2023. Predictive analytics can help brands detect fraudulent activities by analyzing historical transaction data and identifying patterns and anomalies that may indicate fraudulent behavior.
Retail and commercial banks can use predictive analytics to analyze historical transaction data to identify patterns that may indicate fraudulent activity. They can then use this data to create algorithms to detect and prevent fraudulent transactions in real time. Furthermore, there are tools available that will look at new and existing customer databases to identify those with a history of fraud to trigger additional monitoring.
Price Optimization
5. Pricing is a critical factor in the success of any business. In 2023, inflation continues to affect the relationship between businesses and their customers, and price optimization helps businesses accelerate growth. There are many pricing strategies business leaders can use, and predictive analytics can determine which ones make sense. Predictive analytics can help brands optimize their pricing strategy by analyzing historical sales data, market trends, and other relevant data. By doing so, brands can set the right price for their products or services and increase revenue.
A B2B or B2C e-commerce business can use predictive analytics to analyze historical sales data and identify trends in pricing, demand, and supplier backlog. They can then use this data to adjust their pricing strategy to maximize revenue while remaining competitive.
Predictive analytics is a powerful tool that B2B and B2C brands can use to accelerate growth in 2023. These are just five examples, but there are many other innovative ways for brands to use the power of data and business intelligence to make more informed decisions and strengthen relationships with their customers. By harnessing the power of data, brands can make data-driven decisions that help them optimize their marketing, inventory management, customer retention, fraud detection, and pricing strategies. Brands that invest in predictive analytics will be better positioned to sustain competitive advantage and drive sustainable growth in the future.