The Problem with Historical Data
What's next on the list for the man who buys a lightsaber from an online retailer? CRM algorithms might suggest an Incredible Hulk fist, a talking Iron Man mask, or a model BTTF DeLorean. But wouldn't it be more helpful to understand what a penchant for Star Wars means elsewhere in the retail galaxy?
Some CRM strategies or recommendation engines focus on big, historic data as a guiding light to predict what's next when, in fact, it's infinitely more bankable to find out who someone is and ask what's behind their buying.
Our lightsaber guy may play the lead in Vader, My Father, an am-dram production for the local church; he may be president of Star Wars' Yorkshire fan club chapter; or perhaps he was merely purchasing a birthday present for his nephew.
Instead of lumping him into a CRM segment with those who look like kindred spirits because they've also bought something Star Wars-y, it's vastly more productive, progressive, and profitable to discern who the person is and how his personality plays across other domains.
Personality is a stable, safe, and constant baseline, a foundation on which to build lasting customer relationships. It's a much better indicator of what someone will do next than 10,000 historic datapoints put through the big data wringer, and a colossal help in creating the best conditions for sale in terms of message, tone, and timing.
How does one do this? Our company has defined a methodology that distills a mix of robust psychological theories, leading with the "Big 5" traits of personality, to identify people by personality. The Big 5 is the world's most researched theory of personality, and identifies five key traits that tend to be stable across an individual's lifetime, and even predicts future behavior across multiple domains.
With lightsaber man, should our data point to his being naturally extroverted on the Big 5 trait spectrum (and he is, in fact, lead in Vader, My Father), then we instantly know more about who he is and can thus engage him in other aisles, not just the toy section.
We know people who measure high in extroversion are sociable, attention-hungry, and enjoy setting trends, so marketing the next must-have smartphone just got easier. The extrovert likes to be at tech's cutting edge, and wants bigger social circles and better cameras to capture priceless moments. Does it come in 10 vibrant colors? Even better.
From our own algorithms, and 30 years of peer-reviewed science, we also know that extroverted people are more likely to enjoy action movies, dance music, extreme sports, and karaoke, so it pays to mix and match messaging based on correlated interests.
At the other end is the introvert, the lightsaber buyer who is, indeed, a member of a Star Wars society. Here, it's best not to push what's
Bringing Science to the Art of Sales
Seven principles for boosting business through analytics.