4 Benefits of a Data-Driven Business Strategy
Are you using big data to inform your business decisions? Because you should be.
Big data is a buzzy term with no single, agreed-upon definition. But it’s fair to say that the term can be explained as a large volume of data that must be processed to reveal information that can enable insights, innovation, and improved decision making.
Of course, defining big data is less important than putting it into action. Here are some of the benefits of adopting a data-driven strategy.
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You’ll cut costs.
Of the Fortune 1,000 companies that use big data, the majority employ it (and see value in its ability) to decrease expenses, according to Harvard Business Review.
By tracking information like sales and expenses month over month and year over year, you can find patterns — like when you’re busiest and when you’re slowest — that can inform decisions about everything from employee scheduling to pricing products and services. Once you see the benefits of data to save money, you’ll likely start using it to inform more aspects of your business.
You’ll confidently launch new products and services.
When it comes to deciding whether to invest in developing new offerings, gut feelings aren’t exactly an acceptable form of supporting data. But findings from social listening — that is, what you learn when you listen to people on social media — are worth paying attention to.
Social listening gives you insight into what your audience and target demographic is interested in, excited about, or totally over. It also allows you to monitor your competitors and get a better sense of what’s happening in your industry.
So, before you spend time and money on expanding your offerings, this information can help you determine not only whether you should launch something new, but also what types of products and services your customers would embrace. You can use your own sales data to validate whether that data aligns with the purchase behaviors of your customers.
You’ll make data an integral part of your culture.
The bigger the company and the longer it’s been around, the more ingrained certain processes and mindsets are, and the harder it is to enact change.
Data can be disruptive. So it’s important to show employees how data has a positive impact on business, like decreasing expenses and taking some of the risk out of new ventures. When the people in your organization start to see data as a helpful tool instead of a competitor or even an enemy, you’re on your way to creating a data-driven culture.
You’ll set a path for the future.
One of the best arguments for adopting a data-driven strategy is that it enables your business to be nimble. And in highly competitive environments, companies that can quickly pivot and adjust course are the companies that survive.
Monitor information like sales data, industry trends, news stories, and social media activity. And don’t rely on just one source of information — to get the full picture, you need a broad understanding of what’s happening in every sector that affects your business.
Sometimes small changes can hint at bigger implications, so stay tuned and be ready to make changes to stay afloat and get ahead.