Lessons from Amazon : How to predict what customers will buy

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With a revenue of over $135 billion, Amazon has become the world’s largest online retailer and continuously drives record breaking sales. They have reached this type of success by building an expertise in operational perfection, platform optimization and a high percentage of repeated purchases across various product verticals.

An integral part of driving customer purchases is using insights from customer feedback about customer preferences and behavior patterns to trigger repeat sales. It can be used for optimizing the platform in a way that is able to predict the future purchases of customers. Having more than 55% repeat buyers, Amazon is among world’s 13 most valuable brands.

Here is a list of ways in which brands can learn from Amazon and similarly boost their business:

  • Have Multiple Points of Data Collection : Most major brands today are selling their products across a variety of channels. What brands lack however, is the ability to gather data from various customer touch points to understand what customers are saying in a structured manner. From the moment a customer lands on Amazon to the delivery and post purchase experiences, the online retail giant collates and utilizes data points at each level to continuously improve customer experience.
  • Segment Customer Profiles : For years, Amazon has based segmentation on purchase behavior of customers. This segmentation automatically updates on the basis of past, present and future transactions done by customers. This permits Amazon to be focused on driving experiences that influence customers into making repeat purchases.
  • Map Purchase Behaviors Across Product Lines : Recent figures revealed that Amazon generates over 29% of sales through their recommendations engine which suggests popular products to specific customers. By correlating and mapping purchase behaviors of customers across different products, brands can build models that can drive repeat purchases. These models not only provide cross sell opportunities, but also help brands understand factors driving purchase decisions in detail.
  • Real Time Processing of Customer Feedback : Amazon places a huge premium on customer satisfaction, which explains why the company consistently tops best customer service performance rankings year after year. From making the email address of their CEO public, to having a round the clock “Mayday” service, Amazon makes sure that their customer feels that the brand is always there for them and that each customer is equally important to the brand. While this prompts immediate feedback from customers, Amazon’s dedicated multi-level feedback processing systems provide the brand with actionable data which they are then able to use to take swift decisions that win long term customer loyalty. The feeling of value that customers get out of this experience further strengthens the likelihood of making purchases on Amazon in the future. This strategy of customer intimacy is an important component in the success of brands that have been successful over decades. When customers feel closer to certain brands, their decision making is influenced by that emotional connect with the brand.

As technology continues to improve so does the requirement for innovation. Amazon understands this concept very well, which is why it invests in new services and technologies year after year. The reason Amazon continues to move far ahead of competitors and build a worldwide retail giant is its dedication for continued improvement while always keeping customers first. It is in the best interest of brands across the globe to learn from Amazon’s lead and make the most of the opportunity provided by the increasingly digitized customer market.

 

About the Author

Shivank

As a part of the Business Development team, Shivank manages Content and Customer Feedback at Wonderflow.

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