Analytics has been used for many years and in many industries, however with the power of computing and the exponential growth in data over the last few years, analytics has increasingly become a hot topic in modern businesses.
Analytics is the analysis or interpretation of data to identify patterns, trends or correlations within the data or between different sets of data. For example, if you have Sales Data for your business, which may include a number of fields, like Sales Units, Sales Value, Time of Sale, Units Purchased, Location Purchased etc., you can model the data by grouping the different data sets and identifying patterns between the variables within your data set.
Strategic business decisions should not be made based on the opinion of the CEO or the Sales Manager alone. They need to be based on factual data from analytical models of the business which provide deeper insight into the business activities. For example, when deciding whether to increase or decrease the price of your product, it may seem obvious that if you decrease your price, you will receive more sales or if you increase your price, you may lose out on sales. However, after careful analysis of your sales data, we can get a good understanding of your price elasticity, an important metric to consider before changing the price of your product. This may tell us that you have an inelastic product offering, which means that an increase or a decrease in your price will have little influence on your sales.
The goal of analytics, is to be able to capitalise on opportunities from the results of the analysis by identifying trends and anomalies which can be used to make informed, fact based business decisions. This may be for future price changes, forecasting sales, product development or many other reasons. The idea is to have the information that you need based on real, relevant and reliable data, to make better decisions for your business.
Every business should have some form of analytics team, whether it is part time or full time, to provide relevant insights which enables you to make the right decisions on how to manage your business better.
If you have any questions, please feel free to get in touch with us.