August 16, 2016
You may have heard of ‘Big Data’ – the catch-all term for the large data sets behind the scenes in business, which can be analyzed for better performance and profits. Analyzing these large data sets can reveal valuable information about consumers and their habits. It can pick out a company’s key performance indicators (KPIs), and highlight how to improve them. Netflix and IBM are two notable brands making great use of big data, with many others following suit.
Now that many transactions take place online, large companies generate huge amounts of data all the time. Analytics software can make great use of these figures, spotting key trends and using them to adapt corporate strategies. Over time, this can significantly increase profits and improve overall ROI for a business. Big data works – and it is generating $22 billion per year as it stands.
What of the Companies with Less Data?
That all sounds great for multinational corporations turning massive profits and interacting with millions of customers each day – but what about small local companies? While 49 percent of large businesses have implemented big data solutions, just one-fifth of small traders have done the same. This could be because smaller companies feel they don’t generate enough data for such software to be worthwhile – which is often true!
However, the same big data principles can still be applied on a small scale, to boost profits and increase ROI. Just because the data sets are smaller, doesn’t mean they don’t have value. Every statistic and figure can reveal something valuable about a company, and modern technology has ways of cracking the codes and figuring out what it all means.
Making Best Use with the Data Available
Remember: a company can’t improve what it doesn’t measure. In order to make changes, it must understand exactly what needs to be altered – and why. Every business’ tech devices and web services are generating tons of useful information every day, which could be put to good use. Free tools like Google Analytics are designed to sift through these large data sets and find the important trends. These KPIs might include:
- Peak times for online sales;
- Length of time spent on sales calls;
- Top seasonal products and when they sell best;
- The impact of promotions and discounts;
- Sales funnel journeys of the typical customer; and
- Overall demographics and spending habits of customers.
Understanding the numbers across these areas gives businesses chance to improve them, or to benefit from them. This can also be really good for the consumer. Any business trying to improve its overall engagement will reach out to its market and offer something extra as an incentive – big data application is no exception.
Small companies can act much more quickly on the information they get. Interaction with customers is often more personal and they can connect to people and solutions faster. This could improve the effectiveness of big data. If they note a trend, they can change direction and address it without too much fuss or disruption.
Big Data in Practice: Helping Companies and Consumers
Online coupon specialists Frugaa have been using big data principles to improve their offer stream. “We have seen a definite jump in offer take-ups since we started using big data to choose the best times to run deals,” said brand spokeswoman Shweta. Once a business knows how its market works, it can serve them better – while keeping its own costs down. Customers report feeling more positive about the brand since it tightened up its deals, and say they get more relevant content from the company now.
It is estimated that 23 percent of small to medium enterprises use some form of data analytics software to assess their data. 73 percent of these small companies say it helps them find customers and attract a wider market. 65 percent also say data has helped them improve the customer experience. The system works, as well. 63 percent of business owners report returns from their investment after one year, and over one quarter get results after just six months.
The Future of Big Data in Retail and Service Industries
Having access to detailed reports on business numbers can help managers hire the right people. They can identify who the company needs – and who will help their customers the most. Every part of the ROI improvement campaign should focus on the end result: a happy consumer. Whether companies are developing better security, improving service delivery or pushing down unnecessary costs, they will do so to improve sales. Analytics software requires a time investment, and often invokes some significant cost as well. With proof that big data can improve ROIs, it seems the software might be worth investing in.
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