Almost every small business generates data regularly. It is sometimes hard to decipher the meaning of data and its usefulness and determine the direction it could give your business. Small businesses need to perform data analytics to make sense of data.
What is data analytics? It is the process of analysing raw data to draw out meaningful, actionable insights. Since you now gained knowledge of what data analytics is, in this article, Hulisa will sketch out the benefits of performing data analytics in small businesses.
Good Decision Making
In this day and age, many companies compete with each other given that they render the same kind of service. Any decision business owners do take may positively or negatively affect how business functions.
Data analytics help top management improves the decision-making process and it could reduce the risk of financial losses. There are two types of data analytics which are predictive analytics as well as prescriptive analytics.
Predictive analytics can anticipate what might happen in reaction to business changes, while prescriptive analytics can recommend how the firm should respond to these changes. Through data analytics business owners will know how their business is doing and how it will perform in the future. This entire process makes life a lot easier for decision-makers.
Data analytics come in handy for business owners for their small businesses when it comes to enhancing operational efficiency. With the example from Analytics Insight, data collection and analysis of the supply chain can reveal where manufacturing delays or bottlenecks occur and assist identify where future problems may occur.
If a demand projection indicates that a certain vendor will be unable to handle the volume required for the Christmas season, a business may supplement or replace this supplier to avoid production delays.
Improve Customer Experience And Retention
Customer retention is one of the most important aspects of running a business. In fact, it’s been shown that companies that focus on customer retention have a retention rate 70% higher than their competitors. But how do you retain customers? By understanding what motivates them to stay with you, what makes them leave, and what they expect from your company. Data analytics can help you do all these things by giving you insights into your customers’ behavior, purchasing habits, and preferences. This allows you to personalize your service and make sure that every customer gets exactly what they need from you.
Data analytics helps reduce costs by enabling companies to optimize their operations, increase productivity, and cut spending on unnecessary expenses. For example, if you’re running an e-commerce store, you can use data analytics to optimize your website design so that it’s easy for customers to find what they’re looking for. This will lead to more conversions and fewer abandoned carts. You’ll also be able to identify areas where there’s room for improvement and focus on those areas instead of spending money on things that aren’t working well already.
Mitigation of Risk
Small businesses are faced with all sorts of risks that may negatively impact the flow of operations. The employment of the data analytics process may help evaluate risks and take preventative measures. With the help of predictive analytics, small business owners may use data to determine the amount of security their companies face. Data analytics is an activity that could be avoided if owners want to keep their businesses afloat.
If you’re interested in outsourcing Data Analytics specialists for your business, Hulisa is at your disposal. For more information visit https://hulisa.co.za/digital-transformation/.