It is important for any business to understand its consumers. The collection of both passive and active data serves to provide insight into the habits, preferences, and needs of an organization’s consumer base.
In data capture, smart businesses do not rely solely on passive data alone. Active data can tell an organization more about its customers than just data that is passive.
Overview: What is active data?
Active data is data that is collected that collects preferences, opinions, and thoughts about services and products.
2 benefits of active data and 2 drawbacks
There are a couple of clear benefits to active data, as well as drawbacks:
1. Benefit: More detail
Active data can provide much more detail about a customer than passive data.
2. Benefit: Context
Active data can provide a context where passive data is not able to. It has been said that passive data provides the what, but not the motivating factors, of a customer.
3. Drawback: Requires much more involvement from customers
Passive data requires very little to no involvement from customers, while active data is much more reliant on customer participation.
4. Drawback: Time
Active data takes much more time to collect than passive data
Why is active data important to understand?
Active data is important to understand for the following reasons:
Knowing your customers – By understanding active data, you get greater insight into your customers. This can put you ahead of your competition in meeting their needs and desires.
Forecasting – Understanding active data can help you spot trends and make predictions that can put you and your organization ahead of the curve.
The customer experience – Having a solid grasp of active data helps you provide a better experience for your customers.
An industry example of active data
A toy company has been getting some negative comments on social media. It is difficult for the organization to ascertain, however, if these comments are being made by people who actually buy their products. In order to make sure that they are providing their customers with fantastic service and to see where they can improve their service, the company decides to collect some active data by way of a survey at the point of purchase.
3 best practices when thinking about active data
Here are some solid practices to keep in mind when it comes to active data:
1. Your data collection does not need to cost much
Use your active data collection as a low-cost method for finding the strengths and weaknesses in your marketing as well as engaging with your customers. Active data collection can be as simple as a survey that customers fill out after a sale. Doing this cost very little and can offer a great return on investment.
2. Make improvement your primary reason
Improving the customer experience should be the primary reason for obtaining feedback from them. With the information you get from the active data you have collected, you can then offer an exemplary experience to your customers that will keep their loyalty.
3. Combine both types of data for the most complete information
For the most well-rounded look at the customers that frequent your organization, a combination of both passive and active data is best.
Frequently Asked Questions (FAQ) about active data
What are some examples of active data?
Some examples of active data would be situations where you can gain insight from a customer about how they feel in regard to a certain topic. Social media research, feedback forms, surveys, and questionnaires are all examples of active data.
What are some examples of passive data?
Passive data is data that is gathered that can be used for statistical analysis, but which cannot provide context. Some examples of passive data would be dwell times, clickthrough rates, total sales, and website impressions.
What is an example of how passive and active data can be used together?
A clothing company could look at what product constitutes the bulk of its sales. This would be an example of passive data. It could then take that information and conduct a survey of its customers to find out why they preferred that product over the rest of what it offers. This would be active data.
Active data gives your customers a voice
With passive data, you can get a lot of useful information about your business and the habits of your customers. Active data, however, gives you a much fuller representation of why your customers make the choices that they do. It also gives your customers the opportunity to let you know where your business can improve. With the collection of both of these types of data, you can be a better business to your customers and make sure they are heard.