It is official – data is now the most valuable asset in the world, ahead of oil, according to The Economist. The shift comes as no surprise — 97% of businesses use data to power their business opportunities, and for 76% of businesses, it serves as an integral part of forming a business strategy. But, what makes data so valuable? In this article, we look at why data is an asset to any organization, and how data analytics can help you make the most of this asset.
There are many different types of data analytics, largely depending on the question the data analyst or data analytics company is trying to answer. This includes predictive, prescriptive, diagnostic, and descriptive data.
Put simply, data is customer information that, when analyzed and monitored correctly, is able to provide insights into your existing and potential customers. Clean, organized, and up-to-date data is an asset because it can help your company meaningfully engage with customers, make business decisions with confidence, add value to the organization, and better inform product and service development.
Customer engagement reflects the interactions a customer has with your brand. The ongoing relationship between a brand, and whether (and how) a customer chooses to engage with it, is closely tied to retention and loyalty. An engaged customer will likely spend more and be loyal to the brand.
Consumers expect to be treated like a person before handing over their business. In fact, research shows that 84% of consumers consider being treated like a person, not a number, very important to winning their loyalty. Modern customers have higher expectations today than ever before and expect more from brands, such as personalized interactions and connected experiences across channels. Indeed, additional research highlights that most consumers only consider brands that demonstrate they understand and care about them, and 79% of consumers expect their interactions with brands to be personalized.
A brand’s ability to provide these meaningful and personalized interactions is therefore contingent on the availability of accurate and comprehensive data — to understand how best to engage with their customers, and which approaches may be more harmful than helpful in boosting retention and loyalty.
The availability of comprehensive, high-quality data directly impacts an organization’s ability to make informed decisions. Reliably sourced data at statistically significant sample sizes, validated by skilled analytical professionals, is vital to building confidence in organizational strategies. It can serve as a benchmark for what currently exists and allows organizations to better understand the impact their decisions will have on their business.
Further, as data is logical and objective, it removes the subjective elements from the decision-making process, allowing organizations to instill confidence in the company as a whole. As a result, organizations are better able to commit to a specific vision or strategy without worrying that the wrong decision has been made.
However, the accuracy of the data is vital. Unreliable data can limit the confidence that key decision-makers have in their decisions. Indeed, confidence in data amongst executives continues to be a serious issue — 84% of CEOs surveyed in KPMG’s 2016 Global CEO Outlook were concerned about the quality of the data upon which they’re basing their decisions. When there’s a lack of trust in data quality, confidence in the results is compromised which negatively impacts enthusiasm for further investment in data and quality improvement initiatives.
As such, effective business decisions are ideally well-informed and based on accurate and comprehensive data — only possible when the data collection process or interpretation is based on regular measurement and monitoring of the impact of every business decision.
The idea behind data-based decision-making is to gain a competitive advantage and generate value for the organization. In a market with so many customers willing and ready to switch to another business, organizations must make it their mission to add value regularly to maintain their edge.
Accurate and comprehensive data should be available at all levels of an organization’s analytical chain of custody — from its collection and warehousing to its processing, analysis, visualization, and communication, and eventually, to the hands of organizational leaders that enable its impact on actual processes and decisions. When an organization embraces and incorporates a culture of data, the impact on spending and operating costs is positive and significant.
To be sure, strong data insights can bring value to an organization beyond just the bottom-line — customer-facing uses of reliable data, also referred to as top-line use cases, and can positively impact pricing and marketing decisions.
Finally, with the help of reliable data, the process of bringing a new product or service to market needn’t be a painstaking process. For organizations of any size, but particularly for those still in or just recently advanced beyond their start-up stage, new product or service launches can be make-or-break moments — with the potential to directly impact everything from cash flow to market valuation, as well as a company’s ability to attract and retain investors for further growth.
With a good data strategy already in place, a company’s existing products can generate user data to inform future innovation and development.
Using these products to collect nuanced information about customer behaviors can inform how customers use a given product and what improvements they may desire — setting up future product launches for success.
Customer data is the most effective resource an organization can use to tailor the way it markets its product to a customer’s interests. Without this information it is difficult, and in some cases nearly impossible, to personalize a campaign to the next potential loyal customer or partner.
As a result, organizations that do not make collecting, analyzing, and regularly updating customer information their priority, miss out on a slew of opportunities. Additionally, these missed opportunities are often capitalized on by an organization’s competitors — particularly by those who are gaining more insights from data and have a more mature understanding of data.
The benefits of data-driven decision-making are clear, but when your organization is yet to implement data collection, monitoring, and analysis, getting started can seem like an overwhelming task. However, with small, gradual changes towards benchmarking performance, documenting everything, looking for patterns, and adjusting where and when necessary, any organization can thrive and become more data-driven.
The global market is heading toward an increasingly data-driven future, where the value of data will continue to grow significantly. Organizations must shift how they view and treat data so that they thrive, gain a competitive advantage, and do more with this wealth of information available at their fingertips.
To that end, there’s never been a better time to make sure that you’re getting the most out of data — your company’s biggest asset.
Need help to turn your company’s raw data into a strategic asset to grow your business and outperform your competitors?
We at REEA Global have the skills, tech stack, and experience as founders and starters to understand, organize and interpret your company’s data to help your growing startups or company make the most of its data.
Ready to learn how to put data analytics to work for your company?
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