For businesses operating in the digital space, data analytics can help you to better understand your internal processes and customers, as well as give you an edge over your competitors. In this short introduction to these benefits, presented by the Perdido Key Area Chamber of Commerce, we’ll explore the use of data analytics in a business context and how it can be leveraged to improve your efficiency and decision-making moving forward.
Understanding Data Analytics
Before we begin to explore examples, it’s important to first understand the forms that data analytics can take. In a nutshell, data analytics relates to the accumulation, analysis, and implementation of raw numbers/figures to better understand a business and/or its market. There are four common models in use today:
Descriptive Analytics is the simplification and communication of data. This form aims to condense information around “how many, when, and where” and format data in a way that is understandable to the business
Diagnostic Analytics is the examination of existing data with the aim of providing insight into previous results and outcomes
Predictive Analytics is the process of using data to identify future trends, patterns or causation
Prescriptive Analytics is the application of data to help businesses identify advantageous decisions. Using artificial intelligence, it’s possible to test potential outcomes safely and without committing resources
Customer Acquisition & Retention
It’s difficult to overstate the advantages of using data analytics in the process of acquiring customers. With the right implementation of data, it’s possible to refine your sales approach using diagnostic analytics to examine the effectiveness of your previous strategies, and prescriptive analytics to determine a new course of action. This process is likely to result in a higher rate of success and more efficient use of company time, especially if you have datasets pertaining to your existing customers and you’ve begun the process of defining customer profiles.
Data can also be used to manage and bring value to existing customers. Using the right model of analytics, it’s possible to evaluate customer behavior and bring to them new products or services that could be of value to them.
Data is not only useful as a means to understand customers, but it also helps you to better understand the company itself. For many businesses, the aim is to democratize data across your teams, enabling end-users to act upon varying data sets and communicate with one another in real-time, ensuring efficient decision-making. With a centralized “data warehouse,” you can sync data directly to your frontline tools (such as Salesforce or Marketo) and build more effective workflows for everyone.
There are many uses for this data mining that should remain internal, but do not overlook the value of being transparent about some of your processes. Showing how specific choices your business has made have paid off can be great to have available for potential investors to see. Or if you were pushing a big socially conscious initiative, show your customers the results of those efforts. You can turn a PDF into an image to show this data and include it in an email campaign, an investors report, or even on your website. Customers generally appreciate this level of transparency, even if the initiative didn’t work out the way you had hoped. Transparency builds trust and authenticity, which is great for developing your business and your brand.
Data has proven value within the field of marketing as it automates many of the previously menial tasks and helps businesses predict consumer behavior. With the right application of data, you can put in place a more reliable decision-making process that will improve the ROI of your marketing efforts (helping you to determine who you should be directing campaigns at, for example).
Incorporating Your Own Data
As a business hoping to thrive in the digital space, you’ll need to incorporate data into your practices. By taking the time to understand data analytics and bringing in the right expertise, you can help form the infrastructure and habits for long-term success. And if you want to build transparency and ethos with your customers, share some of these data with customers through strategically included JPG in marketing or solicitation materials.
Connect with and learn from other local business leaders by joining the Perdido Key Area Chamber of Commerce.