In today’s world, there is an abundance of data available, and it makes sense for companies to take advantage of this information to gain more accurate insights and uncover new opportunities. Surprisingly, however, not everyone is keen to do this.
A recent poll conducted by Deloitte has revealed that sixty-seven percent of executive-level professionals do not feel confident in their ability to access or utilize data from the tools and resources available to them in the workplace. Consequently, they are resistant to adapting their approach to make use of data analytics, and instead opt to maintain their current working practices. To protect their own positions, they often make excuses – the most common of which is that there is insufficient return on investment to justify the expenditure on data analytics.
It is abundantly clear that there is sufficient evidence to refute that statement. Utilizing data analytics can lead to a significant increase in return on investment. However, it is necessary to acquire the requisite knowledge to ensure success. Fortunately, beginning down this path is easier than one may think. Below are four strategies to enhance the ROI through the use of data analytics.
However, first, a word about data culture’s significance.
It is essential to stress the significance of having a data-driven culture in order to achieve success with analytics. Without being able to persuade the decision-makers within the organization to recognize the value of the data, any recommendations or insights will be ineffectual. For this reason, it is imperative to construct an environment within the organization which is centered around data.
By encouraging your teams to use data to inform the development of plans, goals and to identify trends and opportunities, you will be fostering an environment of innovation. Without such encouragement, your staff may become stuck in their ways, resulting in your business lagging behind its competitors.
Assembling an organization that is driven by data can be an intricate endeavor. Nonetheless, in order to ensure the successful implementation of this approach, it is essential to ensure that all teams have bought into the idea. To do this, it is beneficial to provide concrete examples of how data analytics can improve their daily operations and add value to the existing data. The more support you can obtain from your employees, the more straightforward it will be to embed a data-driven attitude throughout the company.
Bring on the advice!
It’s important to have a strategy before you begin.
Realizing the potential of data analytics requires proactive and thorough planning – if you’re expecting to simply implement a data analytics platform and immediately see a return on investment, you may as well be throwing your money away. Ultimately, you cannot expect to gain any value from analytics if you do not understand what value looks like.
Rather than setting the goal of increasing return on investment, it is of paramount importance to be well prepared for the data journey. To do so, it is necessary to specify precisely what you want to achieve with data analytics. This means that you should decide not only what and when to measure, but also how to measure it.
Making informed decisions can be achieved by applying the relevant metrics. A goal of yours should be to attain wisdom, however this should be done with a clear and calculated approach. Failure to do so will result in data being a disorganized collection of symbols and visuals that lack meaning.
In order to gain meaningful insights from a large and varied data set, it is essential to have a clear process in place. This process should outline how the data will be collected, stored and reported on, so that time and resources are not wasted on unnecessary data collection and storage. Without such a process in place, it is almost impossible to make sense of the data.
It is essential to take all of these factors into consideration when creating your initial plan. Doing so will provide you with a clear path to follow moving forward. Examining the data analytics cycle can help you understand the various steps involved in the process.
How to think in a way that leads to useful conclusions
Data analytics is a powerful tool for gaining valuable insights about your customers and their purchasing habits. However, if you do not know how to utilize the data you have gathered, you will not be able to maximize your return on investment. To ensure that you are making the most of the information you have acquired, it is important to have a clear plan in place to utilize the knowledge you have acquired to help you improve your business strategy.
It is of limited value to undertake an analysis if there is no action taken as a consequence of the findings. Carrying out this task requires a great deal of knowledge and experience, as it is necessary to be able to identify which measurements are relevant to the concepts being studied.
If we were to evaluate two separate marketing initiatives solely based on the numbers, the differences between them would be quite noticeable. One initiative has a higher click-through rate (CTR) with fewer impressions, while the other has a lower CTR but more clicks. However, a marketing group may be able to identify that the second campaign was more successful as it had a higher percentage of ad click-throughs. This demonstrates how understanding the context behind the data can provide valuable insight into the effectiveness of a marketing campaign.
However, it is essential that a marketing group goes beyond the threshold of useful understanding to gain a comprehensive understanding of the metrics. By combining the metrics in question with data from other sources, the group can identify what went wrong and develop new ads accordingly. For example, it may be determined that the second campaign’s black-and-white photographs had a more powerful impact on the target demographic, or that changing the language used led to a higher number of click-throughs.
Despite its apparent ease, this case study serves to emphasize the importance of obtaining meaningful information from data. Constructing a successful data analytics plan necessitates expertise. This is crucial as it will define your objectives for collecting data and the relevance of the metrics you acquire.
It is important to remember that the most effective approaches to data analytics involve combining a variety of measures. This enables the creation of detailed and informed conclusions. However, it is not only the analysis itself that determines your return on investment (ROI); the actions taken and decisions made based on the analysis will also have an impact on the final ROI outcome. Therefore, it is important to consider the implications of the study before taking any action.
Think about the information that is qualitative.
Many data analysts make the mistake of disregarding qualitative data. Whilst hard data can offer an element of comfort, depending solely on this type of data can give a limited view of a situation. It is interesting to observe numerical trends, but without contextualising this information with qualitative data, it can be difficult to draw meaningful conclusions.
It is important to remember that your brand’s story is also told through unstructured data such as social media comments, online reviews, photographs, videos and other materials related to your product. These can be difficult to interpret, but they should not be disregarded. Without them, it is impossible to get a full understanding of the motivations, attitudes, behaviors and preferences of your target audience.
Data analytics can provide invaluable insights into understanding your customers, however, it is important to remember the value of qualitative data. Qualitative data can reveal new business opportunities, growth opportunities, ideas for development and even provide feedback about your business that may otherwise remain hidden. This type of data can be a valuable asset when making decisions about how to move forward with your business.
If you choose to invest in a complex analytical tool and the knowledge required to use it, but do not take advantage of its full potential, you are likely to receive a very poor return on your investment. This is like purchasing a Ferrari, only to drive it to the local supermarket – a waste of money with no benefit.
Observe, tweak, and try new things
You are aware of the potential of data analytics to provide valuable insights into your company’s data. Even though your business may be performing well, there are three essential components that should never be overlooked:
- Maintaining command of the specifics of your data collection and analysis procedures
- Changing anything that can be improved upon or isn’t producing the desired outcome.
- Trying out novel approaches and ideas derived from the information
It is essential to be vigilant when it comes to data collection and storage processes, as it is possible that the data being collected is not pertinent to the objectives and some potentially vital information may be missing. By taking control and regularly making changes as required, it is possible to identify any discrepancies.
It is clear that, as a result of the monitoring, you will need to alter your data analytics process. Particularly if you have just begun to use data analytics, it is likely that your original aims and objectives will change as you progress with your plan.
It is understandable that the notion of experimentation can be daunting, particularly when considering the potential return on investment. However, if the current strategy is proving effective, there is no need to alter it. Similarly, if data analytics are not yielding desired results, it may be beneficial to experiment further in an effort to understand why desired outcomes may not be being achieved. The primary goal of experimentation should be to evaluate the potential avenues for business expansion that data analytics suggests.
Given the investment you have made in both data analytics resources and personnel, any further advantage that you can leverage from them will help to maximize your return on investment. Even though you may be content with the return you are currently receiving, there is always room for improvement. It is crucial, therefore, to experiment with new ideas, consider different approaches, and be prepared for the challenges that come with venturing into unknown areas.
In Other Words, It Was an Effort Well Worth Making.
Despite the fact that there is an overwhelming majority of people who have yet to recognize the potential benefits of data analytics, it is important that they reconsider their stance. With the right knowledge and expertise, data analysis can be a highly advantageous tool, making it well worth the effort to explore its potential.
It is important to remember that the success of your return on investment is largely dependent on the strategy that you devise and how you execute it. When you place your trust in the figures and figures, you may be able to reduce costs, enhance sales and raise awareness of your brand. While this may not be a straightforward process, the advantages that your business will experience will be worth the effort.