Big businesses can't survive in today’s economy without big data, and this trend shows no sign of slowing down. It's estimated that a mind-whopping 463EB (exabytes) will be created each day by 2025. To put that amount into perspective, the highest memory specs for the iPhone 11 Pro is a capacity of 512GB (gigabytes), which is equivalent to 0.000000512%. That’s a lot of useful information that companies can use to understand more about their customers' habits and gain an advantage over their competitors.
How data can help
Specifically, any business, no matter its size, can use customer data to:
- Understand customer preferences
- Track customers through various stages of the sales cycle
- Enhance customer service
Analysing data therefore allows businesses to adapt their offering to meet consumer needs - you can think of accurate analyses of big data as a way to predict what items a business should be selling and how customers will react to potential new products. This is the reason successful companies employ the use of CRM (customer relationship management) systems, which contain powerful features that help businesses to better understand their customer base.
CRM systems can also play a role in improving customer service through:
- Logging past interactions for cross-team collaboration
- Setting auto-reminders for regular customer contact
- Collecting feedback to see how satisfied customers are with the current level of service
Together, this contributes to a high level of customer experience and can help businesses build better relationships with their customers.
Data-backed decision making
Without hard data backing your decision-making, business owners often fall back on using managerial intuition to make their decisions. For example, a manager may be able to recommend which items have the best potential for cross-selling or up-selling from their years of experience in sales.
This approach to guide sales strategy can be successful, as there are factors that can be difficult to quantify and add into the equation of what makes products sell. However, it’s always good to get a second opinion. And one that’s supported by previous sales information brings a certain level of credibility with it.
Big data algorithms, for example, can show which items were most commonly bought together and make recommendations for future product pairings. But cross-selling isn’t the only benefit that these systems have the potential to provide; it’s far easier to sell to someone who has already bought your products in the past, and upselling is a credible technique used by many retailers to boost their revenue stream. Understanding how and why your customers buy your products is the key to unlocking your store’s full sales potential, and a system that correctly interprets data is a good way to fast-track this process.
Simply put, data is used to identify trends and patterns that companies can capitalize on in order to learn and grow. The good news is that there are plenty of growth tools available on the market for a range of business types.
How to use data software for your business
The majority of companies will have some form of management software in place, perhaps even multiple pieces of software, to help them track key metrics. Some popular reports for SMEs include X & Z reports (also known as the 'end of day report'), inventory level reports, and periodic sales reports. These can help supplement financial reports, such as cash flow reports, balance sheets, and profit & loss statements, giving you greater understanding into how your business is operating.
The first step to analysing data for your business is to find a good piece of management software that will provide you with the reporting and insights that your specific business requires. If you're looking for free software to get started with, Google has a whole range of tools that you can use to analyse online data, including:
- Google Analytics: Track your website’s traffic and get detailed reporting
- Google Trends: This can help you see popular search terms within your industry
- Google Ads: Pay to display your business or service above organic search results
Many platforms are designed specifically for certain business sectors, such as retail or hospitality, with specialized features for that type of business. It's important to do your research so you identify the software and systems that are best tailored to your business so that you get the most out of your customers' data.
About the Author
Cordy Bartlett is the Senior Marketing Executive at Tillpoint, the cloud-based POS & management platform that gives retailers and restaurateurs a way to run every part of their business through a suite of business apps, with access to powerful growth tools.