Learning About Customers Without Asking

The Internet gives incredible opportunities for companies to learn about their consumers. Most managers view learning as actively asking questions directly to consumers and listening to their responses. Alternatively, managers can passively learn by observing the choices that consumers make. Passive learning techniques include user profiling, collaborative filtering, path analysis, and conjoint analysis. These techniques can be used to extract knowledge from online data sources like purchase transactions, clickstream data, and e-mail. Together active and passive learning can be used to create personalized environments for consumers. Such personalization gives higher value and causes customers to become more loyal and more profitable for businesses.