Essay Sample: Use of Customer Data in Organizational Decision-Making

The topic selected for this study is customer data collected by a grocery store using loyalty cards and the use of the information in decision making.

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Grocery stores have been encouraging customers to acquire loyalty cards for their shopping. The cards usually contain quite a long range of personal information about the individual retail customers' consumption behavior. The stores in promoting the acquisition of the loyalty cards, they major in selling benefits such as discounts and vouchers one can win for being a holder. The businesses rarely disclose the benefits they get from the card holding from a customer such as the increased customer base and use of the information to make decisions about what to stock or stop stocking because of changing consumer behavior. The loyalty cards ability to store information is marketed as a source of keeping track of the customers shopping in the store and for keeping records for the accumulation of loyalty points rather than the individual consumption behavior. Other than the common benefits derived from the ownership of the loyalty cards, it is interesting how organization use information collected from loyalty cards in decision making. Policy makers in the grocery stores use the collected data to ensure that they make future decisions on customer preferences and choices when they visit the stores. The use of information from different customer needs to make a business decision creates an exciting learning platform for a one to understand how individual customer data is analyzed to make a collective decision for a whole business. More interestingly one wishes to know how the data collected is used to create competitive advantage in the current intense competitive market.

It is hard to differentiate goods from one grocery store to the other and hence customer satisfaction is paramount to ensure customer retention and attraction. One of the ways in which organizations ensure customer satisfaction is maintained is investing heavily in research and development to understand changing customer preference and choices. Also, the research and development help in providing creativity and innovation is integrated with the business for future success and avoids using outdated techniques to win the market. Though research and development are a necessary activity for an organization, it consumes a lot of resources and reduces the financial power f an organization to compete effectively. Therefore, the use of data collected from loyalty cards can be used to lower the cost used in research and development, and hence creates an interest in finding out the contribution of loyalty cards in reducing the cost.

In the analysis of the customer data collected from loyalty cards, I would wish to discover the influence of the information in the decision making of stocking of goods. Policy makers in an organization are faced with a dilemma on a number of particular products that should include stock and the level at which they should restock. I hope to find out whether the used of loyalty cards data from customers helps in making such important decisions in inventory control. Since customer needs vary from one individual to the other, I hope to find out the influence of individual client in deciding what to stock especially on products preferred by few customers who are relatively low in number. In such case of goods preferred by few customers, I hope to be able to find out the ways in which the groceries value individual clients in the success of their business.

Regarding the information collected, I hope to find out the personal data considered as important in decision making by a grocery store. I would wish to know the particular information considered more important in the decision making of the future consumption of the customers and how the decision makers group the customers according to information collected. I would also hope to find out the influence of the decision making in the enhancement of customer loyalty in the store. I would wish to find out the impact of the decision derived from the customer data collected from the loyalty cards in the improvement customer satisfaction. This is because the main idea of gather information using the client's data is to increase the satisfaction of their needs in the particular stores. Also, one of the aims of grocery stores is to ensure the stock turnover is high as well as increasing revenues. In the analysis of the effects of using customer data collected from loyalty cards, I hope to discover the influence of the decisions made in inventory turnover and revenue generation.

Since loyalty cards help stores to gather information from customers without going out in the field and carrying out a survey, I hope to find out how research and development costs are affected. I would also wish to determine whether there is a significant influence of the data collected from the loyalty cards in creating new research and development areas. I hope to find out the connection between the information obtained from the loyalty cards and the quality of research development carried out. Finally, I would wish to know whether the information gathered from the loyalty cards help in increasing the profits generated by grocery stores.