Business analytics play a big part in the corporate world. You might be skeptical about that statement, but studying data and figures is the reason why large corporations stay on top of their chosen industries.
Take online retail giants Amazon as an example. When they altered their recommendations system so that it became part of the entire browsing and purchasing experience, Amazon experienced significant growth. The decision to fully integrate recommendations was due to their data-driven research of key analytics. They study the behaviors of their customers and what they purchased, and tweaked the system accordingly.
While big organizations have been utilizing business analytics for some time now, more and more companies – including small startups – are taking advantage of this feature. The reason for this is simple: Google Analytics. Rather than using complicated systems, online companies can gain a greater understanding of their customers – such as their browsing habits and purchasing decisions – by looking at the automated analytic figures produced by Google Analytics.
With that said, website figures are only part of the analytics puzzle. There are various different pieces to play around with and to see if they fit into your business plan. If you get it right, however, the discovered data can make a massive difference for your company.
What types of business analytics does a company need to know about?
As mentioned above, there’s a diverse selection of analytics that an enterprise can utilize. Alongside website traffic, consider the likes of email open rates, revenue figures, social media numbers, and so on. Nevertheless, these can be broken down into four general business analytics sections:
- Descriptive analytics
- Diagnostic analytics
- Predictive analytics
- Prescriptive analytics
What are these exactly? Well, below is a quick breakdown for each analytic type.
As the name implies, descriptive analytics explains what happened with your existing data, and breaks it down into digestible chunks. This will be done with specialist intelligence tools, due to the amount of data that is, quite frankly, beyond human comprehension.
Descriptive business analytics is particularly helpful as it can paint an accurate picture of your company. You have the ability to identify the strengths of your company while also being able to strategize and eliminate any recognized weaknesses.
The process of descriptive analytics is completed due to two main techniques: data mining and data aggregation. Historical data is mined and then analyzed. The end result: you have the ability to analyze the behaviors of your consumers and see how they engage with your business.
This is another one where the name essentially spotlights this analytics’ purpose. By utilizing techniques like data mining, data discovery, correlations, and drill-down, diagnostic business analytics supplies insight into why something may have happened in the past. This is beneficial if you’re wondering what events and factors contributed to a certain business outcome.
For instance, diagnostic analytics can help you gain an understanding of why sales increased – or decreased – during a specific year. This is helped by the technique using probabilities and outcomes as part of the analysis.
Oh, look, another technique that can be easily deciphered based on its name. Predictive analytics is, predictably, used for attempting to foretell future outcomes. It cannot accurately predict when an event will happen in the future, obviously. It can, however, forecast if an event will take place by analyzing all of the probabilities.
To achieve accurate predictions, two elements are required: existing data and machine learning algorithms. If the predictive business analytics model you use is fine-tuned, it will be able to deliver complex forecasts for your marketing and sales.
Hey, remember when the names of the techniques would be a giant hint towards their function? Well, prescriptive analytics is a different story. If you’re wondering how it works, it’s not too dissimilar from the previous point of predictive analytics.
However, it goes beyond what standard predictive analytics will achieve. By utilizing a specific course of action, prescriptive business analytics can deliver the most favorable outcomes to guide your enterprise along the way. This is assisted by the analytics’ throwing up various other courses of action, which can benefit your business when it’s trying to reach a particular outcome.
The benefits of paying attention to business analytics
After the previous section, it’s fair to say you will already have an understanding of the benefits of business analytics. However, this section will really hammer home the main benefits of using analytics, and why your enterprise needs to implement it as soon as you have finished reading this article.
Gain a greater understanding of your customers
When you consider the importance of your customers, it makes sense that you would want to know as much about them as possible. At least, that’s the case if your desire is to analyze their business-related stats.
For gaining a greater insight, it all begins with using the most effective analytic tool. In this regard, social media is actually one of the best picks. Major social media platforms will allow businesses to look into statistics and figures. This means you have the opportunity to see a general viewpoint of the ages, locations, and even hobbies of your customers.
Another useful tool is the aforementioned Google Analytics. This is the ideal option for studying the performance of your website. You will be able to examine statistics like page visits, the average duration for sessions on your site, and conversion rate percentages. Furthermore, there is additional analytics software available, which even tells you where visitors to your website have previously been on the Internet.
This type of general feedback helps in one massive way: recording what your customers are purchasing. Not only can you see which products/services are selling the best, but you can also look into what your customers are searching for, what areas of the website they are browsing, and what landing pages are converting sales.
Enhance your marketing efforts
Linking to the previous point, business analytics opens the door to additional insight into your marketing strategy. For example, your data might highlight that certain campaigns, website content, and social media posts are not producing the desired results. If this is the case, you can revitalize your marketing efforts or go in a different direction entirely.
The fun with analyzing data is that you can see, in real-time, what is or isn’t working. This means you can quickly make alterations if needed, or build upon techniques which are producing results. The more you keep trying, the more likely you will be to find the right combination – and business analytics will be right there by your side, offering guidance to the promised land.
Tip: Persistence is an important quality for any aspect of the business. This is the case when analytics are not displaying the results you desire. Don’t get disheartened. Use these undesirable results as an opportunity to refresh your marketing strategy. You might need to revitalize your visuals or the overall message of your campaign – maybe even both. For a second viewpoint, you could always reach out to your customers and gain direct feedback about what they feel isn’t clicking marketing-wise.
An increase in data availability
More than ever, people on the Internet are willing to share their personal details. This is supported by the prevalence of social media, yet certain promotional tactics are also effective for gaining data from customers.
For instance, you could use your previously collected data to identify a coupon offer that will work well and send this to your customers. They will receive a useful coupon to spend on one of your products, and you get their data in exchange. It’s a win-win for all of those involved.
It goes without saying, but you always have to monitor and analyze the data you receive constantly. If you fail to do this, you might miss out on a golden opportunity that presents itself. On the other hand, you could keep doing something that is detrimental to the running of your business, and it could easily have been stopped if you glanced at the analytics.
To help with measuring, set goals for your business. Aim for a certain amount of visitors to your website. Target a specific number of social media followers you want to gain. Push for a sales objective. Go with anything that can be easily measured. It also doesn’t matter what these initial targets are – aim for the moon if you feel it’s attainable. What is important, however, is that you measure these goals alongside your business analytics. Then when it comes to the next time you set these goals, you will be able to go with more specific and realistic aims.
By doing this, you always have an objective to move towards. This not only helps with motivation, but it also gives your business a certain level of structure.
How to be better prepared for analytics
While you know what the benefits are and the types available, it still doesn’t answer a big question: How can you prepare your enterprise to use analytics in an effective manner?
As an answer to this question, take into account the following four points:
- Use the right systems: As mentioned already, the likes of Google Analytics and social media are a great starting point as far as systems go for measuring analytics. With that said, there are various specialist analytic tools on the market that can supply data in different ways. The only issue with using specialist tools: they’re typically not the most accessible and can be difficult to navigate for beginners.
- Learn on-the-job: For some people, learning on-the-job is the best way for them to absorb information and gain a greater understanding of the task at hand. If you fall in that category, dive head-first into the action. Look at your business analytics tools and try and get a grasp of the stats and figures staring you in the face. The more you do this, the more comfortable you will become with business analytics.
When you hit a stumbling block and require assistance, this can often be found with a simple Google search. The most popular analytic tools will typically have easy-to-follow guides and YouTube videos available.
- Pursue a degree: Thanks to the nature of online learning, it’s entirely possible for you to earn a degree while you still run a business. Admittedly, you might not end up with any free time for a relatively short period, but just imagine the rewards at the end of the journey.
The ‘relatively short’ aspect is an important one when it comes to online education. You could earn a master’s degree in business analytics, and do so at a fraction of the time it takes in a traditional educational system.
As for why you would want a degree, well, the reasons are obvious. In general, you gain a much greater understanding of the world of business analytics. Along with being taught the latest analytical processes, you will learn how to use specialist technologies and powerful methods to tackle complex business issues.
Oh, and another plus point for online learning: you will be able to find analytics courses where you require no prior background in the field. You can jump in at any point.
- Bring in an expert: If you can’t find the time to earn a degree – and your business has the expendable cash to hire a new employee – there’s always the option of bringing an analytics expert on-board.
By doing this, you are going to receive adept assistance with your analytics immediately. There’s no waiting around: an expert can get right to work, analyze your data, and whip up a plan that will see your business grow.
It is vital your enterprise utilizes business analytics. It delivers an excellent insight into how your company is operating, supplying a clear vision of what tactics are doing well – and not so well. This also covers various aspects of your business, ranging from sales to social media figures.
A strong analytic-based plan will require proficiency and knowledge about the subject. Once those skills are in place, you will forever pay attention to analytics in business.
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