Customer Analytics – Descriptive Analytics

Notes taken are from the Wharton Business School MOOC course.

Customer analytics refers to the collection, management, analysis and strategic leverage of an organization’s granular data about the behaviors of its customers.

Descriptive analytics:

• links the market to the firm through information
• information needed for actionable decision
• principles for systematically collecting and interpreting data that can aid decision makers

There are 3 types of descriptive analytics:

1. Exploratory research (ambiguous problems) – to develop initial insights/hunches
   • technique used is usually focus group / market research online communities (MROC)
     • enhance engagement with customers
     • caveat: ROI can be hard to determine for MROC and the duration can range from 6 months to a year
2. Descriptive research (aware of the problem) – generates data describing the composition and characteristics of the relevant groups
   • Method 1: Active data collection
     • surveys
     • self-reports of several types of consumer behavior
   • Method 2: Passively observing behavior
3. Causal research (problem is clearly defined) – requires systematic data collection and careful thought on how to collect the data
   • Note that correlation NOT equates to causation
   • 3 requirements for causal inference: 
     • correlation: evidence of association
     • temporal antecedence: X must occur before Y
     • No 3rd factor driving both: control of possible factors

Stay Curious Always

Z