Data and data analytics are important for business for several reasons. It has been so over the centuries. For the simple reason that data and analytics help owners and managers understand how a business is faring and what needs to be done.
However the terms assume newer dimensions now due to shift from conventional, paper-based manual methods to more complex, Internet-based techniques. The needs of businesspersons from yesteryears were different than those of today. Because the bulk of business transactions or at least some part leading to deals occurs online.
Hence, let’s take a closer look at why data and analytics are important for a business.
Importance of data & analytics for business
Most businesses worth their name are online nowadays. They mark their online presence through a website simple or complex or even an ecommerce portal that allows people to order online.
This makes data and analytics very important for a business. Here’s how.
The first data that should concern any business is the bounce rate of their website. Lower bounce rates indicates that customers or persons interested in the business are genuine and wish to learn more about its offerings. On the other hand, higher bounce rate is a clear signal that something is amiss. Either Google or other search engines aren’t identifying the business website for its relevance or it’s not ranking enough to merit a display.
A business can have that groundbreaking product that has global applications. Yet, if the business website has a high bounce rate means there’s an urgent need to review content. That content and manner in which the business and its offerings are presented needs an immediate review.
Gathering data about who is visiting website of the business and from which location is also equally important. It helps understand whether the business is reaching the right target audience or is getting hits from a market it cannot serve. Or it can indicate the existence of a market which the business is unaware of and can take steps to mark an entry.
Analysis of data regarding demographic reach of a website also helps understand why there’s larger interest from a specific geographic zone. This, along with the bounce rate can provide vital inputs if people are merely looking for a specific product and visiting your website or there is genuine interest.
Online marketing campaigns, though economical compared over traditional media advertising, does cost money. And if these campaigns aren’t leading to adequate conversions as customers, there’s a need to review the entire marketing strategy. This is done by a simple method of calculating cost per conversion.
For best results, the cost per conversion has to be fairly low. Or it eats into the profits a business would make from a customer. Unless of course, the organization is looking to popularize a product or service and isn’t really concerned about the income. Yet, knowing how much money is being spent on digital advertising and the net results does prove useful when it comes to drawing a social media marketing strategy or revising an existing one.
Predicting Client Behaviors
Online data that a business captures from a website and its analysis can provide some knowledge of client behavior. Every business desires repeat customers and from various areas. When a client repeatedly visits a website for placing orders, it helps predict their behavior over the next few months and make offers that ensure loyalty.
However, if clients don’t return after a single order or enquiry, there’s some work that needs to be done to convert them into customers. Predicting client behavior isn’t an easy task. It requires very skilled data analysts, software and integration with Customer Relations Management systems.
Helps Decision Making
Data and analytics are invaluable when it comes to decision making for any business. They provide insights whether the business is headed in the right direction or something needs to be done to steer it on desired track. It helps identify market trends and needs while finding why specific products or services are faring well while others lag behind.
Generally, most companies hire a trained digital marketer to gather and analyze data their website generates. Or if you are a small business, you can avail a data analytics course from a reputed digital marketing company and do the processes yourself. Because often, data and analytics are top secrets of every business.
Such data can help take vital decisions. Including market expansion, widening the range of products or services, pricing policies and customer care, among others. A company that takes decisions based on data and its analysis usually retains an upper hand over competitors. Because it can base its decisions on genuine data rather than guesswork or ambiguous information.
Data and analysis are nothing new, though the techniques now in use are shifting to an altogether new paradigm. Analysis of data, learning from its results and utilizing them can help every business cut losses while boosting profits. Ecommerce is here to stay and grow exponentially. In such scenarios, only data and analytics can help a company flourish, if put to proper use. In fact, businesses that fail to utilize data and analytics are sounding their own death knell.