How big data can help small businesses
The term “big data” covers a lot of ground. Every action that’s performed on an Internet-connected network provides data. This can include sending an email, posting to Facebook or Twitter, writing a blog, commenting or rating a product, updating a profile, shopping online, using a cellphone or tablet, and swiping a credit card at a physical store. Every one of these actions generates a digital footprint.
With this amount of activity, it’s no wonder we create a lot of data. As of June 2017, we created 5 zettabytes of data, but by 2020 digital information will grow to 50 zettabytes.
But we’re not only creating a lot of data, it’s also been at the forefront of the news lately. It was widely reported that data from more than 50 million users on Facebook was gathered by a third party without the users’ permission, making it one of the largest data breaches in the social network’s history.
As of June 2017, we created 5 zettabytes of data. But by 2020 digital information will grow to 50 zettabytes.
The growing use of data can lead to an increase in cyber risk for small business owners. As data collection grows, so does the need to be careful with the digital information your business is collecting. The last thing you want to experience is a cyber breach. But while there are risks, there are also a number of ways data can be useful to businesses. And not just big businesses. Both large and small organizations are integrating data and analytics into their daily operations.
Below, we outline some of the ways data can be helpful for small businesses:
Improving decision making
The right data can help companies become more informed and efficient. With that, a company can make better business decisions, which in turn will help them become more competitive. But with so much information available, it’s important to establish what information is important in order to achieve your business’ goals. For example, while web traffic is one of the most important pieces of data a business owner can have, for many organizations it fails to offer any actionable insights. But when a business owner is able to see which demographics and customer segments are spending the most time on their website, that data can be used to improve marketing efforts.
As a small business owner, it might be overwhelming to gather and organize your data. You might not even be sure where to start or be worried about how much it will cost you. Thankfully, there are several ways your small business can gather and analyze data without breaking the bank. Platforms like Google Analytics or IBM’s Watson Analytics can assist with gathering data, so that you can extract long-term data to reveal trends and other valuable information.
Understanding and interacting with your customers
Data is a great tool to better understand your customers preferences. You may think you know your customers and what they want, but big data will provide a definitive answer. By analyzing the data your company collects, you can identify consumer trends and predict market opportunities. In a recent research report, the Boston Consulting Group shared that businesses that create a more personalized experience for their customers will see their revenue increase by 6 to 10 per cent. This will also help you be more agile and responsive to the ever-changing needs of your customers.
For example, a restaurant in the New England area, Farmstead Table, took advantage of big data by using a point of sales platform to not only process credit card payments but track anniversaries, birthdays, favorite meals, and other customer data. With that information they could save time but more importantly, target customers with relevant messages that generate repeat sales.
Utilizing social media
Social media has become a crucial part of digital communications strategies. In 2015, Facebook influenced 52 per cent of consumers’ online and offline purchases, up from 36 per cent in 2014. And 71 per cent of customers who have a positive service experience via social media are likely to recommend that company to others. That’s why it’s so important for companies to be active on social media.
Using tools like Social Mention and Twilert, you can set up alerts and notifications whenever a subject you’re interested in is mentioned online, like your business name, the products and services you offer, or any relevant keywords. By tracking these mentions, you can be sure to respond to customers as often as possible. This helps you make sure your company is a part of the conversation, and allows you to tailor your responses to generate more interest and improve customer satisfaction and engagement. Using these platforms, you can also leverage positive customer experiences.
Running your business smoothly and efficiently can be easier when you effectively leverage data. Whether it’s data related to your warehouse operations or your customers, it can be analyzed and used to improve operational processes and actions.
Once you’ve got a handle on how to utilize data with your company’s current offerings, you can start to research potential new services you could offer because of data. For instance, Rolls-Royce added a data-based element to one of their products. Using sensors in the jet engines they manufacture, they can monitor the performance of those engines even after they sell them. Using this data, they can monitor the performance of the engine in order to predict maintenance needs, and can offer this as a service to their customers. Servicing now accounts for 70 per cent of the company’s annual revenue.
Data is an extremely useful tool for any small business. And while innovation in your company is important, it’s also important to protect what you already have. Want to learn about how we can help protect your small business? Our experts have a wealth of industry expertise – find out how we can help your business!