How Data Analytics Can Help A Business Grow

Introduction

A study featured in Forbes shows that companies who are data-driven can get 23% more customers than their competitors. 

Data is the key that can open the door to success for your business. From giant companies like FacebookAmazon and YouTube to small and local companies, all are using data to scale their business. Marketing strategies and the development of new products are also driven by business stats and data. 

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If you don’t know how data analytics can help a business grow then read this article till the end. Although different companies can get various insights through data, I’ll be talking about the main benefits that you can get from analyzing your data. 

How data analytics can help a business grow
How data analytics can help a business grow

How data analytics can help your business? 

Data analysis can give you insights into your customer’s behaviour and their demographics. It can help you in deciding your next marketing strategy and who are your ideal customers. It can even give you information about what people likeand what needs improvement.

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Let’s see in detail how much you can learn from data that can help your business grow. 

1. Understand your customer better:

Understanding customer behaviour and learning about their demographics and interests is probably the biggest use of data these days. It’s because once you know your customer you can market to them what they’ll surely buy. You can make more focused marketing strategies and brand awareness campaigns.  

Customer demographics also matter a lot. If you’re selling to teenagers your marketing campaigns won’t be the same if you were selling to middle-aged people. This is one way how data can help you understand your customer. How much meaning you can extract from data analytics is totally subjective to the analyst. 

Example:

For example, if you have an e-commerce store you can know which product is the most popular among your customers and which needs improvement. 

Another example can be a blog. Data can show you on which pages your customers are spending the most time. You can publish more content like that to attract your readers. 

2. Save your money and take less risk: 

Once you know your customers and have business insights you have less risk to take. 

“Will this campaign work or will my money be wasted? I’m not sure if this campaign is worth the investment or not.” Such thoughts won’t bother you that much as your decisions are backed up by strong data. You know what your customers like and you’re exactly giving them that. 

This can save you from spending money on campaigns that won’t bring in results. Rather you’ll now have an estimate of how much this campaign will be a success, all thanks to the data. 

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A survey conducted by BARC shows that companies using data have seen an 8% increase in profits and a 10% decrease in cost. 

Example:

Here’s an example of how data can save you money. You can know from analytics which products aren’t performing well. You can stop spending your time and money on that, rather you can focus on what people are liking. 

3. Double up on what’s working: 

You know what’s working and what’s not. Which type of strategies and tactics are bringing in business and which aren’t. You can easily double up on those things and eliminate the tactics that aren’t giving results. In this way, you can grow your business faster and more efficiently. 

Example:

Let’s take an example. You tried a new marketing technique last month and noticed a spike in sales. Next month you try another technique and don’t see any visible difference. Through data, you know which technique worked and which didn’t. Now you can double up on that and spend your money wisely. 

4. Improve your cyber security:  

Data is a big thing these days. Companies want to protect their data so no one can misuse it against their business. Hackers are also a threat. They can hack the site and this can severely affect your business.

Data helps save data. It can show you the potential security threats. You can take protective measures to increase your cyber security. For an e-commerce site, this is extremely important. People can’t afford their credit card information to be insecure.

5. Efficiently manage the supply and demand: 

Data can help you increase your business’ productivity and manage the supply and demand chain more efficiently. A lot of businesses run out of stock on holidays as the demand surges. You’re missing a lot of sales. Data can assist you in solving this problem.

Example:

For example, your holiday campaign can give you insights into the demand for each product. You can plan in advance and increase your inventory to meet the potential orders. 

Importance and benefits of data analytics
Importance and benefits of data analytics

6. Data help you scale your business: 

Data can help you scale your business the right way. The results it gives can assist you in making your next move. Is this the right time to open an outlet for our e-commerce store? Data can give you the answer. Which new product should you launch? Data analysis can show you what your customers will like. 

Example:

Let’s see an example, If you want your online e-commerce business to go hybrid data can help you decide the location for your 1st outlet. It shows you how many of your customers are in each city. 

Or if you’re planning to launch a new product data analytics can give you an estimate of how popular it’ll be among your customers. 

7. More business opportunities: 

Yes, data analytics can open doors to new business opportunities. It can show you the gap in the market that you can fill or an untapped area of the market. It can unravel the needs of customers where you can provide a solution to get more sales and expand your business. 

8. Keep an eye on your progress and goals: 

Is your company going according to your goals? How will you measure your success and keep an eye on your company’s progress? Data analysis is the answer. It allows you to measure your KPIs (Key performance indicators). 

You can see how well your company is doing. If your running campaigns aren’t giving positive results you can change them or make some amendments in it. All these results are derived from data.  

9. Get insights into your competitors: 

Competitor analysis is a technique that many companies use. This can help you in understanding their techniques and tactics. 

Analyze your competitor to learn their strategies and outperform them. There are many softwares that can give you insights into your competitor’s sales and other parameters. 

Should you invest in data analytics? 

Yes, it’s worth investing in data analytics. However, if you’re a small businessowner or just starting your company you might not get too much benefit from data analysis. Data analytics need data to work. Without any information (data) you can’t get all the befits mentioned above. Once you’ve enough data then you should invest in analyzing it and extracting meaning out of it. 

According to research, 97.2% of companies are investing in AI and big data.

Frequently asked questions: 

1. What is the goal of data analysis?

In business, the goal of analyzing the data is to extract valuable insights from it that can help the company grow. It can help you understand customer behaviour, measure your progress, tell you what’s working and what’s not, you can make informed decisions and decrease the risk both financially and physically. It can also help you in developing products and creating content. 

In short data analysis helps you to analyze problems and find their solutions.

2. Where is data analytics used? 

Nowadays data analysis is used in all types of businesses and industries. From e-commerce to healthcare and hybrid companies all are making decisions based on the data and insights of their company. 

3. How customer database can increase sales?

If you have a database of your customers you can do a lot to grow your sales. Ask for their reviews to showcase to potential customers. You can offer them discounts to encourage them to shop again or you can conduct a survey with them to know what your customers think about your product and company. You can offer them different benefits to increase your sales and let them come back for more. 

4. Why is data analytics important in marketing? 

Data analysis helps you to design targeted campaigns. It gives you customer insights and their demographics. In this way, you can target your ideal customers with the highest chances of them converting into your customers. 

In a nutshell: 

Here’s a quick recap of all the benefits that data can provide you.

1. Understand your customer better

2. Save money and take less risk 

3. Double up on what’s working

4. Increase your cyber security

5. Efficiently manage the supply and demand

6. Data help you scale your business

7. More business opportunities 

8. Keep an eye on your progress 

9. Get insights into your competitors

As a small business, you might not have enough data to extract such information from it. But believe me, once you got enough data it’s going to guide your business to success. 

Your decisions will be more informed and you’ll be confident in investing in campaigns.


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Published by Rahul Bhattacharya

Rahul is a journalist with expertise in researching a variety of topics and writing engaging contents. He is also a data analyst and an expert in visualizing business scenarios using data science. Rahul is skilled in a number of programming languages and data analysis tools. When he is not busy writing, Rahul can be found somewhere in the Appalachian trails or in an ethnic restaurant in Chicago.

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