Data is big business today, but what can it tell us, and why do companies value it so highly? If you’ve ever wondered about the importance of data in business, this article will tell you all you need to know.
Gathering data helps businesses to gain a better understanding of their market, and it also helps them connect with their customers. That said, it’s easy for organisations to become lost in masses of information because too much data is available to them.
People often associate big data with big companies. However, the same big data is available to small businesses, and they often make better use of it. This is because smaller firms are more agile and able to make quicker decisions based on data-driven insights.
A recent Deloitte survey reveals interesting perceptions about data and analytics. The results show that half of us believe that having access to analytics helps us make better workplace decisions. Furthermore, 10% think that data allows them to improve their relationships with customers.
There is such a mass of data available to us that it’s easy to take it for granted. To realise the importance of data in business, we only need to imagine how difficult life would be without it.
For example, how would we make critical business decisions if we didn’t first understand our present position? How would we plan a marketing strategy if we had no idea how to reach our customers? Or how would we decide what kind of content to create for our social media feed?
Top Four Reasons Why Data is So Important to Businesses
There are countless reasons why data is so important to businesses but the following four are arguably the most beneficial to all who use data.
Data Helps People in Business Make Better Decisions
There are many ways in which data can help us make better decisions, both as individuals and at an organisational level.
An excellent example of how data can help individuals at work is when a salesperson deals with customers. Data provides salespeople with facts about their products, making for a more convincing sales pitch. It can also help them decide when to push a sale or when they might be wasting their time.
Using data, managers can determine how to respond to global news. When covid-19 first hit the headlines, it was hard to tell whether it was hysteria or a genuine crisis. Johns Hopkins University’s data helped us understand how the virus was developing globally and locally. Having access to this information helped businesses manage changes quickly and make long term plans.
There is nothing quite as persuasive as having a good set of hard facts to back you up when making decisions. Data can help everyone, from Change Managers looking to improve business processes to Marketing Executives seeking justification for their latest advertising campaign. Having reliable data can improve every aspect of an organisation or individual’s career.
Data Helps People Solve Problems
To understand how data can help us solve problems, let’s consider a couple of common scenarios:
Firstly, let’s consider a small business that’s had a very slow month with sales. They might use an e-commerce platform such as Shopify to help them analyse their data. These analytics can help them understand the reason behind the drop in sales and what they must do differently to increase future sales.
Another good example is a Marketing Executive whose most recent Facebook campaign was a flop. Campaign analytics can help marketers understand customers’ actions upon viewing the ad, which can help them improve the success of future campaigns.
Data Enables Businesses to Understand Performance
Data helps us to visualise performance. For example, professional sports teams often use data to see how changing tactics might help them win more games. Formula 1 teams also rely heavily on analytics to understand their cars’ performance. This data helps them make lightning-quick decisions that can mean the difference between crashing out or winning a race.
All professional sports teams will have a team of analysts who help them achieve winning results. The world of business is no different. No matter what industry you’re in, if you want to improve performance, you must first analyse the data you have. These analytics can show you how you are performing and provide clues about where you can make improvements.
Data Brings Businesses Closer to Their Customers
When a new product comes to the market, new customers don’t know it exists or why they need it. If businesses want customers to buy their new product, they need to influence them to change their behaviour.
To do this, businesses must reach their target customers in the right place at the right time. But how do they know where the right place is or when the right time is? To find the answers to these questions, they must access geographic, demographic, and even behavioural data. This data provides valuable insights into who their customers are, what they are interested in and where they hang out.
Market data also helps businesses understand trends and customer pain points. This information can be crucial to a Customer Services Manager looking to improve customer service. It can also put you in a prime position if you feel the need to pivot at a later date. If you work as part of a fast and growing organisation, this will help you greatly when anticipating future market changes.
Experts say that data is the voice of the customer, and it is vital that business leaders listen to it. For example, if 80% of a company’s revenue comes from just 20% of its customers, good data will help identify its most valuable customers.
A Few Final Thoughts on the Importance of Data in Business
Anyone wanting to run a successful business, grow their professional network, or generally do well in life can use data to their advantage. It doesn’t matter whether you work as a manager, in sales, tech product design or anything else; data can help you do your job.
Likewise, no matter what your interests lie if you want to work in data, there will be a job for you in any field imaginable.
If you want to make sure that you are using data to your advantage, apply it to your job role. Leveraging data will help you ensure that you are continually ahead of the ever-changing market. It will also allow you to provide a much bigger and better service to your customers.
If you’re interested in working in data, why not take a look at our latest data jobs to find out what employers are looking for?