By Carol Trehearn
Behind every business, there is tons and tons of data. However, this “raw” data is essentially useless until it is analyzed and grouped into categories. For example, the raw data businesses collect in the background could be data on customers’ spending habits, their preferences, the most popular choice of color for an item, and so on. Using this data can be extremely beneficial to analyze historical patterns and also help predict future behavior and opportunities, which is where analytics comes in.
For these reasons, it is no surprise that analytics continues to become one of the fastest-growing markets in the business world.
So, what is Analytics?
Analytics is essentially a methodical organization of data and statistics via computer programming and analytical tools. Generally, the analytics should be able to show conclusions that have been drawn from the data and what this might mean. These conclusions can then be used to improve, refine, or protect businesses.
“Analytics can help predict future behavior.”
Why Use Analytics in Business?
By using analytics, businesses are capable of accurately measuring all areas. The collection of data can benefit so many areas of business. Risk analysis, fraud analysis, market modeling, and web analytics are all groups of analysis that can assist in those areas of business. Using specifically targeted analysis can decrease adverse outcomes such as fraud, limit risk issues, and help predict the future market, enabling businesses to foresee potential opportunities.
Analytics can also offer a “real-time view” into a business, which allows the monitoring of shifting trends and key performance indicators in real-time.
Businesses need to be data-centric to gather a full overview of the health of a business. For example, data can give explanations to the loss of customers, returning customers, and encourage customers to continue to choose them for business.
The segmentation of data can really allow a business to be dissected, covering all aspects of demographics such as location, age range, shopping habits, internet habits, and what products are used. Being able to group this data together means you can directly target specific groups that appeal to their individual needs and interests.
It is no secret that businesses are now focusing on retaining customers as a preference for drawing new customers in and to achieve this, a business needs to be versatile and agile. The trends are ever-changing, and to keep hold of customers, there has to be room for adapting. Adapting to customer’s needs, foreseeing potential issues, and also being able to offer solutions are all essential strategies for retaining customers in business. Analytics can certainly help these processes run smoothly.
Analytics and Business Growth
Quite possibly one of the most essential factors of analytics is it offers the opportunity for business growth. Analytics has the potential to encourage positive growth in all areas of a business when appropriately utilized. From decision making to helping spot ideal demographics, the data can guide you to the next best step.
“Make decisions based on solid data.”
For example, using analytics while decision-making means that any decisions made will be substantiated with solid data, rather than made exclusively on something such as intuition.
Having a collection of data from customers, clients, and website visitors will also allow businesses to hone in on their ideal demographic. It could be that a demographic that is being targeted might not necessarily be the demographic that is responding to the business. With that in mind, being able to consistently see demographics of those engaging with a business means that businesses can use that information to switch up strategies or show businesses who, perhaps, their target market should be.
Analytics and Risk Assessment in Business
Something that is just as important as growth to businesses is limiting risk. Using data compiled by analytics allows businesses to perform risk assessments and enables them to act quickly, making changes to alleviate that risk.
But how can businesses do this?
Risk assessments in analytics work by building measurement parameters that can help businesses determine and investigate likely risk scenarios. In doing this, businesses can plan around the risk and the potential impact of the risk.
An example of using risk assessment could be from the finance and banking industry. When applying for a credit card or loan, computer programming will gather previous data to compile an insight into previous patterns in finance or banking history. This particular risk model provides accurate measures of credit risk or lost probabilities.
Analytics and Happy Customers
For businesses to run smoothly, productively, and to grow profitably, customer happiness and satisfaction should be at the forefront of business priorities. But how does analytics factor into customer happiness?
Analytics can collect and organize all aspects of customer data such as (but not limited to) customer satisfaction feedback, email, and phone call data, delivery, and shipping data and complaints. With all of this information at a business’ fingertips, it is easy to keep an eye on what is working and what might not be. Maybe there is a dip in the data in correspondence resolution or a spike in customer feedback in a specific category. This data can drive future decisions in a productive direction.
Asking customers directly what they would like to see from a business or product is also beneficial information. And using data collected from sources such as a survey can guide businesses on the right path with their future plans.
“Speak to customers directly to gain useful information.”
Analytics and Cost Reduction in Business
Cost reduction is just another excellent benefit of using analytics in business. When critical data slip through the cracks and are not considered when forming insights, this can create very costly issues for businesses.
However, when kept on top of, analytics can help save costs on marketing, advertising, and other areas by removing trial and error and using informed financial decisions instead.
When it comes to products, analytics is also an excellent tool to highlight products that are currently trending, where sales are positioned and offer a clear picture of which products could be updated or given a prioritized place. Cost reductions can also be implemented from data analysis outside of sales. They can improve cost efficiency in areas such as negative feedback (which can be seen in real-time and addressed immediately, to the shipping side of the business. An example of this would be keeping track of data on vehicle parts, enabling a more accurate prediction of when parts might need replacing. This not only keeps maintenance costs down but also keeps unsatisfied or disappointed customers to a minimum too.
Learning Analysis in Business
What does Learning Analysis Involve?
Learning analysis for a business is a valuable skill that includes measurement, collection, analysis, and reporting of data. Because of these skills, the data is then able to be categorized into insights that allow a business to see its weak spots and areas that are flourishing.
Acquiring these skills can secure great job opportunities in all kinds of business sectors, such as finance, healthcare, and accounting.
The use of analytical tools is also essential when it comes to learning analysis. There are plenty of powerful analytical tools that can propel a business forward such as SAS software (Statistical Analysis System) and SAP software (System Application and Products) and completing an online MS in business analytics will ensure complete proficiency in systems like this and help build the crucial skills that businesses sought after.
How Can Analytics Change Your Business?
There is definitely a competitive element when it comes to analytics in business, so it is crucial for a business to harbor analytical skills.
Using analytics in business means access across organizations and over the whole industry – which is a lot of information! This offers a competitive edge in seeing what trends are working in sales, for example, and also where improvements could be made. Not only that, but there is also the option to spot gaps in the market, which can lead to new strategies to propel a business forward.
“Improve strategies and create measurable results.”
Furthermore, using analytics in your business means the information can be used to change current strategies for the better, creating measurable performances, achieve better results, and of course, out-perform the competition!
Using analytics can also be extremely beneficial for guiding the future content of a business. Using this gathered data means businesses can be aware of what their customers are interested in or engaging with first-hand. This enables a company to fast forward guessing and trying out different strategies, and dive head-first into personalizing their adverts and products to target specific demographics or categories of an entire customer base. Not only does this improve marketing efforts, but it is also part of the analytics process that can save a significant amount of money!
There are so many ways in which analytics is changing the business world, and these will only become stronger as time goes on, and further tools become more advanced. The crucial thing to do is to get on board as a business and implement analyzed data. Use the tools and insights that grouped, analyzed data can offer businesses to help overhaul and improve all areas, including customer relations, marketing, risk assessment, business growth, and cost reduction!