The current exponential growth of data is key to the changes we see in businesses benefiting from data analytics. All companies, small to large, can use data analytics to optimize performance, drive business strategy and increase the bottom line.
Data is collected every second of every day from social media channels, email subscriptions, cookies, etc. Whether or not businesses can properly analyze this data and use it for growth is up to them. In this article, you’ll learn about data-driven analytics, why data analytics is important and the benefits companies receive from using data analytics to make informed business decisions.
What is Data-Driven Analytics?
Data-driven analytics is the process of discovering, interpreting and communicating significant patterns in data. Simply put, analytics helps individuals and businesses see insights and meaningful data that you might not otherwise detect.
Data-driven analytics can use data to:
- Automate decisions
- Discover relationships
- Predict unknown outcomes
- Answer business questions
This diverse field of computer science is used to find meaningful patterns in data and uncover new knowledge based on applied mathematics, statistics, predictive modeling and machine learning techniques.
Why is Data Analytics Important?
Today, data analytics is found everywhere because every company wants to perform better and will analyze data to make better decisions. As technology becomes increasingly advanced, more and more companies are developing new ways to use big data to their advantage to maximize their profits and improve the customer experience.
Companies should seek to be data-driven in order to maintain competitiveness in an increasingly competitive global market. No matter what you plan to accomplish with analytics, the first requirement is gathering data. Once you have data, you need to analyze that data. Then you need to position the results of your analysis to drive decision-making.
Benefits of Data Analytics for Business
Help Overall Decision-Making
Businesses ranging from small startups to Fortune 500 companies generate data and therefore can analyze it to help with overall decision-making. Data comes from website traffic, social media presence, customer purchases and more.
Although leaders can look at what’s happening in the company, in the news, or even their gut instincts, there’s nothing as valid as hard data to back up the decision-making process.
Businesses can use data analytics to make decisions about:
- Predicting sales trends
- Finding new customers
- Increasing customer retention
Ultimately, data helps leaders make smarter decisions about their companies’ next steps.
Help With Marketing Efforts
Marketing departments especially rely on data analytics in order to drive growth and track the success of a business.
According to this article by Grow, a Business Intelligence software company, 5 examples of data points marketers can track using data analytics include:
- Marketing Qualified Leads
- Web Traffic (new and returning)
- Monetary Goal Values
- On-Site Conversion Rates
- Sales Process Conversion Rates
Of course, these aren’t the only data points marketers can use to track conversion from marketing efforts. Depending on what type of product or service a business provides will inform the marketing department of which data is most useful to analyze.
Help With Customer Retention
Data analytics allow businesses to access and interpret customer data in order to leverage it for higher sales. Data helps businesses understand consumers and therefore increase customer retention.
According to this infographic by invesp, “The probability of selling to an existing customer is 60-70%, while the probability of selling to a new prospect is 5-20%.” This is one of the reasons why customer retention is so important and why customer data should be analyzed.
Help Improve Processes
All businesses usually have a main goal: to reduce wasted time and money. Data analytics helps improve processes to reach that goal.
For example, if a business is spending a large amount of money producing targeted Facebook advertisements to people, but not seeing a large return on investment, then there’s definitely data one could analyze to figure out why. Perhaps the marketing department realizes their target audience doesn’t hang out on Facebook, rather they hang out on LinkedIn.
This knowledge would help the marketing department allocate its budget to LinkedIn rather than Facebook; therefore, saving time and money in the long run.
Expand Your Analytics Knowledge at Montclair State
When you pursue an online Master of Science analytics degree from Montclair State University you’ll be equipped with the skill set to drive business change and the use of data in everyday work environments.
Montclair State University is at the forefront of analytics. All of our programs are designed with an understanding that analytics is constantly changing and evolving. Our instructors continuously have their eyes on the horizon, looking for new roles and uses of data and how to properly integrate them into our courses.
If you’re interested in gaining data analytics knowledge, visit the following Master’s degree pages to learn more:
Montclair State University
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Do you have questions about the online MBA? Set up a time to speak with Student Recruitment Manager, Michele.