No matter how successful your business is, there's always room for improvement. Data analytics — making sense of your data — can unlock new opportunities for efficiency across money, operations, and people.
Data analytics is the process of collecting and analyzing data to make conclusions about it. In the age of information, data analytics helps cut through the noise to reveal trends and metrics — or key performance indicators (KPIs) — otherwise lost in translation.
Applying data analytics provides a better understanding of how a business is performing. It unlocks the power to grow your business by helping you make informed decisions that optimize operations and improve strategies across your business.
While data analytics sounds daunting, all it requires is a little understanding. And, even if you're starting out', you're already on your way — the various apps and systems you use to run your business are already collecting volumes of data.
Data analytics can be applied to all business areas, from finance and sales to marketing and people. For example, if you're in retail, you can use data analytics to identify your best-performing products, or spot buying/ spending trends to inform your inventory management and sales strategies. Similarly, if applied to marketing, data analytics can assess campaign performance, or evaluate what content resonates with a target audience.
There are several data analytics techniques you can use, many of which are made easier with the use of specialized systems and software.
Descriptive analytics describes what has happened over a given period. So, monitoring revenue or sales over time or tracking your Mailchimp campaign's performance.
Diagnostic analytics looks at why something happened. Use diagnostic analytics to understand if your latest marketing campaign impacted sales, for example. The data used is more diverse (than in descriptive analysis) and requires some informed assumptions.
Predictive analytics seeks to uncover what's likely to happen in the near-term. Again, it requires diverse data points to create a whole picture and informed assumptions.
Prescriptive analytics focuses on finding the best course of action. It analyzes various data points to recommend how to optimize business practices to support multiple predicted outcomes.
COVID-19 is changing how we do live and do business. While we are still in the dark about the pandemic's long-term impact, businesses now must focus on rebuilding and recovery.
To succeed, SMBs must be able to make quick, sharp decisions. Business owners need to understand how to implement and harness data analytics. The following are some of the ways data analytics is helping businesses survive and thrive.
Informed decisions are better decisions. Data analysis provides the business insights you need to make smart decisions on the fly to help achieve better outcomes.
When it comes to planning a marketing campaign, developing your product, crafting a sales pitch, or even setting the budget, data analytics helps to eliminate much of the guesswork. Your data gives you a 360° view of your business. Having that insight can help you understand the correlations between actions and outcomes, for example, so that you can make strategic and effective decisions.
To define your market and target your strategies — across business operations, sales, and marketing — you need to know your audience. By collecting and analyzing data on your audience, you get a better image of who you're talking to.
The first step to identifying your audience is to create a customer profile. Established businesses will need to evaluate their existing customer data, as well as conducting some market research. Audience analysis requires research into demographics, location, language, preferences, interests, amongst others. It's also useful to examine how your brand is perceived and how people rate your business.
Your customer profile is then analyzed to provide actionable insights. This data can be sourced online, via analytics platforms such as Google Analytics, social media analysis, or surveys.
Which products are your best sellers or the most profitable? Which of your salespeople generate the most revenue or are the most efficient at closing a deal? How effective is your sales funnel? At which touchpoints on your sales funnel do you lose prospects? Data analytics can help you find the answer to these questions and enable you to make the changes you need to propel your business forward.
For accuracy, consider a customer relationship management (CRM) solution. Managing the sales funnel through a CRM gives you increased insight into your sales conversions, an easy way to report, and clean data!
Data analytics can help you to evaluate your marketing campaigns. Marketing has always been about numbers. Digital marketing, specifically, has come a long way; everything is measurable and traceable, and you can learn so much about your audience and what their interests are. For example, through a digital marketing campaign, you could identify which content resonates with your audience (i.e., a campaign might be more successful with 33 to 37-year-old men in Australia).
Analysis of that data can also help you strategically segment your audience according to behavior, demographics, interests, and engagement levels. With this insight, you can identify which channels/ content effectively attract an audience segment and target them accordingly for the best results. And it doesn't end there.
Smarter, streamlined operations help businesses to improve processes, save money, and boost their bottom line.
Knowing where your business is at, who your audience is and what they want helps you implement savvy strategies suited to your business' evolving needs.
Data analysis isn't new. Technology has revolutionized it. With growing volumes of business, data comes an increased need for more advanced analytics technologies to distill that data into deeper insights, quickly.
Even with technology, successful data analytics requires quality data, skilled analysts, and organizational commitment to using data to inform business decisions.
Web analytics tools such as Google Analytics provide an in-depth view of your business' online footprint and effectiveness.
Smart decisions are informed decisions.