Assignment
Customer Analytics Study Case
An insurance company IFA finds interesting results through correlation studies. This data has to be acquired through a grocery chain Shop Sense How can both the companies leverage data responsibly? Should Shop Sense sell its data from their rewards program to IFA.
Customer analytics is a process by which data from customer behavior is used to help make key business decisions via market segmentation and predictive analytics It helps to predict a customer's buying pattern, it can reveal information about customers taste and preferences This data is gathered by Shop Sense, and it can be valuable to IFA.
Value created with data; IFA can analyze the data bought from ShopSense to screen high risk clients based on their shopping habits It can extend discounts to clients that they consider low risk Is this data accurate to make these predictions?
Correlation does not imply causation.
Should ShopSense and IFA enter a Partnership? Advantages from selling out If ShopSense provides their tapes to IFA they would receive a million dollars of pure profit annually Disadvantages This deal is not without any risks. There are many concerns for ShopSense to sell their data.
Argument against entering into partnership with IFA The primary concern for retailers is to ensure customer satisfaction and extend their customer base and maintain their loyalty Selling client data to IFA could result in Damaged relationship with existing customers a customer's opt out of loyalty programs Risk of consumer backlash is high for ShopSense.
Ethical concerns, The information gathered should be considered personal; therefore, it is not ethical to sell this information or buy this information. Also, an ethical issue arises from deciding prices for personal information. Customers may not know that ShopSense is providing Data to a health insurance company, and their shopping history is being used to determine the premium they pay.
Customer privacy, Consumers do not know where these records are and they cannot be checked for accuracy Changing the data if inaccurate is difficult, if not impossible Consumers do not know how this data is used and what circumstances it will be used for Security of this information cannot be guaranteed, and may be easily accessed by unauthorized people.
Threats and securities,The wirelessly networked business environment creates a high risk to information security Smaller, faster, and cheaper computers allows an increase in stealing or losing data from people. The skills necessary to hack computers are decreasing There is an increase in employee use of unmanaged devices, which increases threats to information ShopSense will have to bear the cost of protecting client data.
Corporate culture, Employees at ShopSense maybe uncomfortable and may have ethical concerns with the business practices Corporate culture will suffer.
Conclusion, ShopSense should not enter into a information sharing partnership with IFA because the only gain they receive would be a million dollars in profit, but the risks involved are high.
ShopSense sales will decrease when customers realize that their data is being sold to IFA Threatens future growth prospects of ShopSense Threatens current market standing Corporate culture will suffer In the world of retail loyalty is hard to win; Customer data needs to be protected.
Answer the following questions preferably 5-6 lines for each question explain in detail, relate the question to the study case, do not copy answers from the study case. this subject is management information system (MIS). add some information from your side and what you understand and conclude.
A. What are customer analytics? How is it helpful to the company IFA?
B. What would happen if shop sense sold their client data to IFA?
C. What are the ethical concerns? How can ethical issue arise, list, and explain in detail.
D. How can shop sense protect the client data
E. Discuss customer privacy, threats, and information security. Why customer data needs to be protected?
F. How can people steal data easily?
G. Discuss cooperate culture and how might employee feel uncomfortable working with shop sense.
H. Should shop sense enter partnership with IFA if NO, why not and what are the risk that will come after being in a partnership with IFA, explain in detail.