Why Data is Important to Business?

What is Data?

Nowadays, the amount of data getting collected by businesses is increasing tremendously. Data is a collection of facts such as values, measurements, observations etc that can be used for analysis or reference. Every swipe, click, like, tap, phone call, tweet, share, etc generates lots and lots of data. Moreover, there are many cheap and easy ways to collect and store data in today’s world of technology. Thus, the sources of data and the methods to keep the data lead to Big Data which is today’s corporate buzzword. Big data is nothing but the collection of large and complex data sets that are too difficult to manage and process using traditional methods and tools.
 

Why Businesses need Data?

“Customer is the King”: this is the new age marketing slogan. Most of today’s businesses are looking for new ways to satisfy their customers to the maximum possible level. To serve the customers better, businesses should be able to know the behaviour of the customers and also the performance of their competitors. A retail chain analyzes their inventory data to stock up goods at the right place and buying trends of customers to come up with new promotions. A social network analyzes its users’ data including demographics, likes and dislikes, shares and comments etc to include personalized ads. To perform all these kinds of analysis, businesses need data. In other words, data is the core asset of any business.
 

Importance of Data

Data is considered the starting point of all types of analysis. It is obvious that decisions are made based on the available data whether in real-life or business. In fact, there is a direct relationship between the accuracy of data and correctness of decisions. So, a business that makes the best use of its data in the correct way at the right time will be able to make better decisions and hence gain competitive advantage. In other words, the success of any business highly depends on how the business collects,stores, analyzes, processes and manages its data because efficient use of data leads to knowledge and information which in turn results in valuable business insights.
 

Importance of Analytics

Why Analytics?

We are living in a world of datafication. To make it clear, data from every aspect of our life gets collected and saved nowadays. The data might be customer data, bank transaction data, phone call details, sales data, stock data, browser logs, informative articles and videos, weather data, and so on. The list does not end here, it goes on and on. Of course, the real-world data is stored in different formats and in different locations. Data could be stored in a simple text file on your machine or as unstructured in a complex data warehouse. Just having lots of data in various locations will not help any business unless the data can be transformed into useful information. Here comes analytics into picture.
 

What is Analytics?

Analytics is a very broad term that refers to the process of transforming data into insight and hence enabling better decision making. Data is important to any business; but analytics is more important in today’s world of data explosion. Analytics, as the name indicates, helps us analyze large amounts of dynamic data from various sources to gain insights that were hidden. Better insights result in efficient decision making which of course lead to reduced cost, increased profitability and crucial performance improvements.
 

Importance of Analytics to Business

It is true that analytics has the power to change anything and everything; not only in businesses, but also in government, healthcare, education, sports and so on. However, businesses make the best use of analytics in different ways to stand out from the crowd. Some applications of business analytics are improved customer relationship management, critical product analysis, optimized stock management, simplified business management etc.
 
Analytics can help businesses understand their customers as well as competitors very well. By analyzing the daily sales, purchasing trends and patterns will get revealed. This kind of analysis helps retailers in a number of ways including targeted marketing, customized promotions etc. Analytics helps companies to segment their market and come up with strategies for the target customers. Critical product analysis helps business to come up with new or altered products that satisfy more customers. By analyzing the sales, retailers can manage their stock efficiently. For example, retailers can optimize their stock by identifying fast moving products or peek shopping days.
 
Analytics is also used for measuring and tracking the results across time which helps organizations to set new attainable goals. Businesses can optimize their supply chain management by identifying the most optimal delivery route. In short, analytics helps businesses gain previously hidden or unnoticed insights from the available data and transform the business to a higher level.