Data analytics in business has gained serious traction in the past several years. There seems to be no end in sight for the rise in popularity. The COVID-19 pandemic forced companies to begin or heighten their use of data analytics as the physical-world marketplace went quiet and people spent more time online than ever before.
What role did data analytics really play as shopping went increasingly digital? Did consumers simply buy what they would have purchased in a brick-and-mortar store from its online storefront instead? Or did data analytics inform marketing strategies in ways that recruited and retained new customers, provided insight into marketplace trends, and drove revenue for companies facing a brave new world?
Even without fully optimized data analysis techniques, many companies who were using data to drive business growth during the pandemic saw positive results. Their examples provide business leaders ranging from the smallest mom and pop shops, all the way up to Fortune 500 companies with creative and practical ideas for leveraging data analytics to drive revenue. Big data is just that — big — but data-savvy marketers know that there are accessible steps to take toward greater data integration that leads to stronger marketing campaigns and increased revenue.
In this post, we’ll look at some of the ways that data analytics impacts a business, especially when it comes to marketing and revenue creation.
How Big Data Analytics Helps Businesses Increase Their Revenue
Big data analytics isn’t just a bright and shiny new thing in the marketing space — it’s a more efficient, innovative approach that connects the art and science of marketing. Data-driven companies don’t leave creativity behind; they find even greater opportunities. Rather than spending countless worker hours attempting to determine consumer behaviors by traditional means, data-driven companies have understandable and evolving data sets at their fingertips.
This not only frees up marketers’ time, it helps them harness it. A creative and progressive approach empowers marketers to build campaigns that simultaneously leverage valuable information, artistic vision, and company expertise. Forward-thinking marketers don’t leave their creativity behind as they reach for data analytics; they merge it together to design successful campaigns, strengthen their brand storytelling, and benefit their companies’ bottom lines.
Take Amazon, for example. Those constant price changes on their website are not random, nor are they merely an algorithm set to try different prices at different times with no informational underpinning. Instead, those price changes are heavily data-driven and personalized, enticing customers to purchase items they have looked at in the past but not bought, or to consider new items that match their previous purchases on the site. By leveraging big data to analyze customer interest, competitor prices, and inventory, Amazon can price its products in ways that attract and retain customers.
Data Analytics Empowers Companies to Set and Reach Their Goals
The team at DemandJump, a customer acquisition software platform, explains how data-driven marketing insights can strengthen goal-setting. For example, data can reveal population segments who share interests or behaviors. That knowledge can enable marketers to strengthen their messages according to their target consumers’ needs and desires. This approach yields better results and helps teams predict outcomes and determine the path to success.
Specifically, predictive analytics help marketers set and achieve clear goals. A Business Insider report found that “predictive analytics can support applications like scoring risk and preventing fraud, and provide insight into consumer behaviors like lifetime customer value and even affective states, like feelings toward a specific experience.”
MarketingEvolution identifies three predictive analytics models that stand to benefit marketers:
Cluster Models: These algorithms are used for audience segmentation based on past brand engagement, past purchases and demographic data.
Propensity Models: These evaluate a consumer’s likelihood to do something, such as convert, act on an offer or disengage.
Recommendations Filtering: This model evaluates past purchase history to understand where there might be additional sales opportunities.
With information like this at their fingertips, marketers can help their companies build on the past and present information to design the campaigns of the future.
Data Analytics Help Companies Carve out Niches in Saturated Markets
When UberEats entered the food delivery game, the market was saturated. So what set UberEats apart and helped them achieve tremendous success? They leveraged data from their ride-sharing service to predict masterful food delivery. UberEats modeled the physical world so they could find the most efficient and excellent plan that would deliver food that’s still warm, make customers happy, and increase profits. As the design and development company Bornfight observes, “What Uber Eats is doing is a textbook example of how Big Data and data analysis can help businesses expand their services and give them a clear advantage over their competitors.”
Data analysis also helps marketers and their companies predict and respond to changes in the marketplace and the expectations of customers. By leveraging data to understand customer trends and the ever-shifting landscape of the digital marketplace, companies can be proactive and creative in their approach to marketing rather than reactive.
But what about companies that are just getting started or want to stay small and local? While they face challenges like limited historical data, OMI points out that continuous cloud integration is a great starting point for leveraging data. With cloud integration, small businesses can adopt a cohesive system that puts data sets into communication with each other. This system can help small businesses make stronger marketing decisions and accelerate their growth as they identify patterns and opportunities in their company’s market.
Using data to drive business growth is possible for small businesses that don’t merely pay attention to sales or revenue statistics but ask insightful questions that help them make the most of their data. Business.com shares a few such questions, like “which vendors offer the most value?” and “which product lines need the most improvement?”
The answers to these questions will help small businesses implement data analytics in useful, sustainable ways that increase their revenue.
Data Analytics Give Marketers Information They Need to Design Successful Campaigns
One of the foremost companies using big data analytics in their approach to marketing campaigns is the multi-billion dollar streaming titan Netflix. The company implements algorithms and analysis technology that helps them understand what individuals are interested in watching, enjoy, and may want to see next. This way, they can design a personalized home screen for each of their over 200 million subscribers, increasing customer satisfaction and loyalty.
Netflix demonstrates a key finding in a McKinsey & Company report: personalization stands to gain five to eight times the return on investment of a company’s marketing spend. It can also increase sales by 10%, sometimes even more.
The retail banking industry uses data analytics to enhance their marketing strategies as well. International Banker gives the following examples of retail banks using big data to understand their existing customers in great detail so that they can market the most attractive and fitting products to them in the future:
Sending an offer to a banking customer because they used an app
Implementing retargeting to feature loan offers on other websites after a customer has searched for loan services on the bank’s website
Using credit-card data to promote products that fit well with something the customer already purchased
In the healthcare space, marketers are using data to drive business growth by studying consumers, patients, physicians, and geographic markets. Wearable technology and other forms of patient monitoring help marketers understand the needs of individuals, the trends of communities, and the products, programs, or services healthcare providers can offer to best serve their patients.
Lastly, consider the fashion industry. Fashion trend forecasting company Heuritech shares an example of a company that used data analytics to design and market a particular style of sneakers to a trendy segment of the marketplace. After using data to determine the optimal design, marketers used data analysis to determine the best time for the product’s launch. They then used consumer data to launch a marketing campaign that matched the values of their target customer. From product design all the way through to presenting a consumer with a trendy sneaker, data analytics joined together with creativity to both create and market an appealing product.
Design the Marketing Campaigns of the Future
The rapid changes in the marketplace have many marketing professionals feeling challenged, if not concerned. But the truth is, many of them already have the mindset and skills needed to embrace the growing role of data analytics in marketing. The answer isn’t leaving behind what you’ve learned from traditional marketing methods. Instead, you can build on your expertise and gain new insights, tools, and abilities with a Master of Arts in Digital Marketing and Data Analytics from Emerson College.
Take that next step toward a brighter future. Schedule an appointment to discuss how online study could elevate your career and potential.