Did you know that it’s possible to use analytics in business, even if you have a small business?
Close to 67% of small businesses spend at least $10,000 a year on analytics. That underlines the importance of business analytics.
It’s easy to get lost in all of that data, though. You can have so much, that you’re swimming in numbers and not understand what the data means.
If you want to know how to use analytics in business and why you should, you’ll want to keep reading.
Read on to learn everything you need to know about using business analytics.
1. Know Your Customers Better
Do you think you know your customers well? Sure, you know their gender, household income, and location.
Do you know the messages that they respond to? Do you know if they only buy if they have a major discount?
These are only some of the things that you can learn about your customers with analytics. You can learn if your customers are willing to pay a premium for great customer service and what keeps them loyal customers.
Business analytics gives you the insights to acquire and retain customers.
2. Make Strategic Decisions
The old-school way of making decisions is to go with your gut. It turns out that your gut’s probability is about the same as a coin toss.
The other decision-making tool is how things were handled in the past. The business world has changed since then, and your ability to make sound strategic decisions needs to change, too.
You can use data to make strategic decisions in every aspect of your business. Accurate financial data lets you know how much cash you have on hand. That leads to spending and hiring decisions.
Productivity data tells you where the bottlenecks are in your business. You can look at past years and see if there are seasonal shifts to prepare for.
3. Become More Efficient
If you’re responsible for maintaining equipment or buildings, data can help you save money. Predictive analytics informs you as to when you need to upgrade parts or perform inspections.
You can make expensive equipment and buildings last longer and lower maintenance costs. Data ensures that your maintenance team focuses on preventative maintenance as opposed to fixing things when they break.
You can use data-based automation to perform repeatable tasks. That reduces time and improves overall efficiency.
4. Lower Your Marketing Spend
What would it mean to your business if you can lower your customer acquisition costs and increase the average order value?
It seems like a winning formula that’s possible with data. Business analytics helps marketers reach highly targeted audiences. Those targets are so precise, your marketing is more effective and you lower your customer acquisition costs.
You can increase your average order value by understanding what your customers want. You can offer additional products based on previous purchases as customer shop and checkout.
5. Improve Conversions
A small increase in conversions can greatly improve your business. Conversions are bound to improve because you can target your ads and you know your customers.
For instance, you’re running a paid ads campaign that leads to a landing page. Data analytics allows you to test different elements of the landing page and make improvements.
You slowly improve your conversions over time.
Another factor in your conversion rate is site performance. Analytics tells you if your site loads quickly or not. Improve the performance based on data and improve your conversion rate.
6. Manage Supply Chains
Businesses are complicated. Your business is dependent upon other influences and people to operate properly.
If you produce a product, you need to get raw materials and send them to the manufacturer. The manufacturer has to have the proper specs to produce the product.
The product gets tested for quality and shipped off to various distribution channels.
It turns out that you have a lot of steps to manage. If there are weaknesses that get exposed along the supply chain, your business suffers.
Disruptions in adhesives and semiconductors are global. You can use data to plan for shortages and continue to serve your customers while your competitors are sleeping.
How to Add Analytics in Business
Are you sold on the value that data brings to your business? Here are a few tips to implement data in your business.
Start by setting goals and expectations. You and your team should figure out what you want data to do for your business.
This helps you set the key performance indicators (KPIs) and figure out what type of analytics solution you need for your business.
The next step is to choose a data analytics platform. There are industry-driven platforms or general analytics platforms.
Fitness centers can use a platform like Easalytics. Auto repair shops can use a platform like the one found at https://www.tekmetric.com/features/overview.
Once you have your platform, you have to work to create a data-driven culture in your organization. It’s not easy to make that shift because people aren’t used to using data.
This starts with the executive team to set the example. The rest of the employees will follow suit.
Your decisions are only as good as the quality of data and your ability to read it. Be sure to test your data for accuracy.
Learn to read data. When you read data, you’re going to make assumptions and draw conclusions. Communicate what those assumptions are as you read data and make decisions.
Using Analytics in Business Makes a Difference
Whether you’re a startup or an enterprise-level business, you can benefit from analytics in business.
You’ll understand your customers and make much better decisions. Your business will be stronger and resilient, too.
Did you enjoy learning about using data to improve your marketing? Be sure to check out the other marketing tips on this site today!