The entire world has experienced decades' worth of change in one year. Because so much of this sudden, unexpected and abrupt change has been enforced by COVID-19 it can be hard, even for organizations that have invested in data and analytics, to distinguish a transient fad from an enduring long-term trend.
The distinction might sound semantic, but it is not. If organizations can detect the signals fast enough – and react accordingly – they can profit from transient short-term fads. On the other hand, organizations should base their strategic investment priorities on enduring long-term trends.
Placing big bets on the basis of one popular dataset is a risk that organizations do not have to take. Celebrity endorsements illustrate the Simpson paradox (the phenomenon where a trend in one dataset vanishes when the data is aggregated). A few years ago, the endorsement from celebrities such as Gwyneth Paltrow and Beyoncé made kale a very trendy food. Data capturing soaring sales suggested a paradigm shift in diets, supply increased accordingly but then demand fell by six percent1, although sales volumes for spinach and brussels sprouts grew. Agile organizations generated extra revenue from the kale boom, whereas late arrivals, slow to receive and/or analyze the data, were more likely to incur extra cost. A thorough analysis of different types of data might have flagged up that the sudden popularity of a particular variety of leaf cabbage was indicative of a broader, deeper trend: consumers' growing interest in healthier foods.
of consumers say they have tried more new brands because of COVID-19 and lockdown.
Understanding such nuances is critical because, as consumers look for shortterm fixes in unpredictable times, demand will probably remain volatile. Indeed, this may already be happening: 27 percent of consumers say they have tried more new brands because of COVID-19 and lockdown.
COVID-19 has shown emphatically how integral data and analytics have become to the way we live, work and do business. It has also exposed how much consumers and organizations alike still have to learn to be truly data literate.
Are you gaining the right insights from your data?
A variety of factors – legacy systems2, data quality, strategy, culture and governance – have thwarted organizations' digital transformation programs. Too often, data is used only – or primarily – to support existing conclusions or gut instincts. Organizations that rely on too few data points risk misreading the market. When data is geared to specific projects, or stuck in internal silos, it is unlikely to inspire the kind of insights that create value, drive innovation and enhance performance. The critical need – ignored by many organizations in a rush to invest in technology – is to identify what decisions you want the data to influence.
of consumers say that buying sustainable goods or services was a higher priority during COVID-19 and lockdown
of consumers say they have used a wider range of technologies during COVID-19 and lockdown.
Data is not a bolt-on. It needs to infuse every aspect of an organization if it is to transform performance and drive value.
Using the insights generated from data harvested across different layers of the organization's, businesses can deepen their understanding of customers – and the paradoxical way they can behave. Why, for example, do nine out of ten consumers say they are happy to pay more to buy from an ethical organization that puts something back into society, yet only 28 percent say they have already done so? Possibly because consumers perform several roles simultaneously and their priorities will change according to whether they are behaving as citizens, shoppers, employees or family members. Consumers' good intent may be frustrated by weather, time, visibility, availability, price or how busy a store is. By clarifying such apparent contradictions, data driven insights can help organizations make better, more informed decisions.
Trust the data, not instinct or experience
If organizations want to avoid 'groupthink', every proposition – especially those based on widely accepted assumptions – should be tested and modeled. It is true, for instance, that consumers across the world are worried about climate change. It is also true that the depth of that concern fluctuates dramatically between regions and generations. Seven out of ten consumers in Latin America are seriously worried about climate change whereas 22 percent of respondents in the US and Canada do not worry about it very much. Nor, surprisingly, do 19 percent of Millennials.
of consumers globally, say they will not share data.
Consumer' attitudes to sharing their personal data do not vary as significantly. Globally, 22 percent say they will not share data, while 13 percent of consumers expect to be paid for sharing it. The biggest perceived benefit – for 22 percent of respondents – is better security but many consumers remain unconvinced that sharing is worth their while.
In such a complex, volatile marketplace, organizations that fail to distinguish the signals from the noise could miss out on promising new opportunities or ignore emerging risks. With so much data in the world – estimates vary but we probably generate at least 2.5 quintillion bytes of new data every day3 – it makes no sense to act on only a small part of it. Organizations that marginalize data, analytics and insights might be blindsided by rivals – often tech giants and disruptive innovators – which have put data at the heart of their business model and their culture.
The past has always been an imperfect guide to the future and, as consumers seek to navigate unprecedented uncertainty for the foreseeable future, it will become even less so. Insight led organizations that constantly, continuously, expand their knowledge of customer needs are much better placed to fulfill them – especially if they base decisions on actionable insights, produced by data and analytics, and not on gut instinct or past experience.
For more consumer insights, please download our latest report Me, My Life, My Wallet