5 Reasons Why Data-Driven Analytics Is of Interest to Companies
Three-quarters of US drivers think their driving skills are better than average. Mathematically this makes no sense, but it does give us insight into the power of data. Information we gather can help us see the bigger picture and make effective choices. Making informed decisions should be a priority at any organization. Let’s explore five reasons why data-driven analytics is of interest to companies.
“People’s deep confidence in their judgments and abilities is often at odds with reality.” – Michael J. Mauboussin, Harvard Business Review
1. Getting New Leads
Data-driven analytics can give insight into customer patterns and behaviors so your marketing efforts can be more focused.
Are you aware of the type of buyer that seeks out your services? Data analytics can help you discover customer demographics so that you can develop a buyer persona.
With a detailed buyer persona based on previous sales, you can target specific types of people who will benefit from your business without throwing shots in the dark. You can also make an informed decision on which kind of buyers not to focus on, saving you time and marketing costs.
Additionally, you can engage with your current clients through email and social media and gather their reviews and opinions to create more data to drive future marketing decisions. This data can later be used to tailor your brand experience for similar buyers.
Related Blog: What Is Behavioral Segmentation in Marketing?
2. Reducing Costs
When your data is properly stored and organized, a business analytics system can help you find patterns and visualize data in all parts of your organization.
Perhaps there are supplies you are over investing in, or not buying enough of when you need it most? Is there a delay in any part of the supply chain or any waste that could be minimized to improve efficiency? With data analytics, these insights become available to you.
If you own a web commerce business, for instance, you might not be aware that certain suppliers run out of stock during a specific time of the month. With this data you can plan ahead and fulfill all incoming orders.
However, good data won’t guarantee good decisions. You need an analytics system to transform that good data into models to inform future choices.
A business intelligence cloud such as Power BI will consume all the data that you have and offer visual models and answers. Your business data can come from application programming interfaces (API), cloud sources, websites, and even the humble spreadsheet.
Currently, not many companies use data analytics to improve their business processes. In fact, only 22% of companies proactively manage their supply chain. With such an unexplored strategy, it’s no wonder that data-driven analytics are of interest to companies.
3. Staying Competitive
Executives from 60 Fortune 1000 companies stated that 97% of their organizations are investing in big data and AI. It makes sense, therefore, for business of all sizes to apply a similar strategy to stay above their competitors who are not effectively utilizing data.
With data analytics tools, you can track key performance indicators (KPIs) such as customer satisfaction, sales, and customer turnover. With these figures in mind, you can focus your energy on factors that drive your company’s success.
Remember that good data won’t guarantee good decisions. However, having a guide from which to jumpstart initiatives is better than leaving them to guesswork.
4. Finding Patterns of Success
Another type of KPI your business can evaluate are financial ones such as revenue, growth, and profits. Understanding the way in which your company is growing can increase investor, employee, and client engagement.
Imagine meeting a salesperson offering a service. Their pitch is intriguing, but they have no numbers to back up their claims. If they backed up their claims with data, their potential buyers would be much more inclined to trust them.
Naturally, one of the insights of data-analytics of interest to companies is which product or service is selling best. But beyond that, analytics can also show you the product’s trends. For example, demand growth over time, which quarters had the most sales, and which demographic demands a specific product.
5. Making Informed Decisions
One of the biggest reasons data-driven analytics is of interest to companies is that it gives decision-makers enough information to make educated choices.
A clear example of this is Netflix using big data to save $1 billion a year from customer retention. The streaming company achieved this by using algorithms to sift through data and predict viewer behaviors. They were able to make better recommendations and personalize home pages so each viewer gets an experience targeted for them.
Your organization, whether big or small, can also use data to improve decision-making. For instance, you could choose better suppliers, decide which of your products deserves more marketing, or which service needs less time and attention from your employees.
Therefore, data-driven analytics can also help your organization mitigate risks. When leaders are making decisions based on guesswork, the results rely on luck. When you can map processes and their results, you can replicate successes or avoid pitfalls easily.
Data-driven analytics can help your organization understand its own growth, success patterns, and pitfalls. Business intelligence systems that can read data to show insights are an extremely valuable tool for any organization.
Data analytics can increase the likelihood of your business targeting the right leads, reducing costs, and staying competitive. The information that can be gained from data can also light the way for your organization leaders to make the best decisions.
With such a prolific tool, it’s no wonder why data-driven analytics is of interest to companies.
To learn more about how data can serve your business and how to implement a business analytics strategy sustainably, join our webinar: How to Become a Data Driven Company. Register now!