Thousands of competing products and brands are available in any industry segment. The only way to differentiate your offerings is by providing a personalized experience to your target customer segment. Business analytics can enable you to achieve this. It can be your competitive advantage irrespective of whether your business is B2C or B2B.
Every business generates a large amount of data daily. This data is a goldmine if leveraged correctly. Business analytics involves applying statistical analysis and quantitative models to derive actionable insights from this data. It allows you to visualize the current performance of your business strategies and predict business outcomes across various scenarios. You can benefit from business analytics irrespective of the industry vertical your business operates.
Let’s look at some crucial ways in which business analytics can supercharge your business performance.
1. It helps you segment customers better.
You can use customer data to derive insights into their preferences and predict customer behavior. Based on the customer’s demographic data and past spending patterns, you can recommend products and price points that increase the chances of conversions. Analytics also helps you determine the customer’s lifetime value. So you can target customers that provide maximum ROI on your marketing expenses. Better customer segmentation enables you to focus on cross-selling and upselling opportunities to loyal customers.
2. It helps determine marketing ROI correctly.
Businesses use several online and offline channels to engage prospective customers. Analytics helps you understand which channels have the lowest customer acquisition costs and generate maximum conversions. With analytics-based marketing automation tools, you can analyze the effectiveness of every customer touchpoint in real-time and tweak your communication strategies accordingly.
3. It helps you monitor customer satisfaction levels.
Gone are the days when you could use simple surveys to determine customer satisfaction levels. Today, you need monitoring capabilities across various social media platforms to determine how your customers feel about your offerings. It involves processing vast amounts of unstructured textual and natural language data, more commonly referred to as sentiment analysis. Data science solutions help you keep your ears to the ground.
4. It helps you nurture your workforce.
Business analytics has applications across HR functions like recruitment, training, and performance management. With thousands of applicant resumes to comb through, analytics makes it easier for enterprises to zero in on suitable candidates through advanced text analysis methods. Analytics also helps you track key performance indicators (KPIs) and satisfaction levels for your workforce. It can help you make promotion decisions. Analytics can also predict attrition and enable you to take corrective measures.
5. It helps predict sales better.
In the case of B2C businesses, analytics uses historical sales data along with various parameters such as raw material costs, inflation, product prices, and marketing spending to predict sales growth. In the case of B2B businesses, analytics can help track the sales funnels and predict the probability of deal closures within given timeframes. Having visibility on revenues and cashflows allows management to make informed calls on future growth strategies.
6. It helps minimize strategy risk.
Business analytics enables the management to make decisions based on data and proven statistical methods. It minimizes the chances of human error or bias creeping into decision-making. For example, if a company wants to enter a new geography, it can leverage analytics on the available competition performance data, channel partner data, and target customer data. It enables the company to predict the performance of its products under various go-to-market scenarios and minimize the risk of failure.
7. It increases the efficiency of the supply chain.
Analytics is indispensable for businesses that depend heavily on supply chain efficiencies to generate profits. It helps you to forecast demand and optimize inventory accordingly. It also helps determine the best shipping strategy for each location and minimizes shipment delays. Especially during the COVID-19 pandemic, analytics helped businesses predict the effect of lockdowns on raw material supply and demand, so they could plan for the same.
Where to start?
Several business analytics techniques like machine learning, artificial intelligence, natural language processing, cognitive process automation, and more are available. The analytics methods and solutions you select depend on the business use case for which you need to generate insights.
It can be perplexing for businesses to choose from the wide variety of analytics solutions available in the market. Also, implementing a solution in-house is not an easy task. It requires a skilled workforce trained in the latest big data technologies and statistical algorithms. You also must set up the necessary infrastructure to store, cleanse, and process the data generated daily. It may be a good idea to test the waters by outsourcing to a business analytics solutions provider. It will enable your analytics capabilities to get off the ground at a reasonable cost. With an experienced, certified analytics consulting provider, your business can start reaping the benefits of business analytics in no time.