We've been hearing for years how big data, machine learning, deep learning, and data analytics can grow revenues by millions and slash customer acquisition costs. And while the hype around data is at fever pitch, exactly how they do that is less clear.
We know we need to be data driven. But what does that mean? Well, a data driven business uses data to drive its own success. It uses data to do things like personalise customer experiences, decrease shopping cart abandonment, grow website conversions, optimise marketing channels for maximum ROI, and inform what product features are prioritised and what gets built next. Easy.
But how do you get there? Here are 6 things truly data driven businesses get right and that you need to do to make sure you are running one of them.
1. Get your analytics stack right.
There is a plethora of third-party analytics platforms available to help you get started, but getting the analytics stack right takes some time and expertise. Make sure you’re warehousing the data correctly and that the platforms you choose are integrated so that you can centralise the data they collect and maximise its impact.
Getting it right the first time saves time and money and prevents key data leakage.
Also, keep in mind that your ideal analytics stack may not look like everyone else’s. It really depends on what data you need and what kinds of metrics you track. When making your decisions, take into account the needs of your business today and the future needs of your business as it grows.
2. Collect only the data you really need.
Don’t be tempted to set up a data catch-all. Identify what metrics matter to you. If you’re not tracking what you need, you experience real-time, unrecoverable data leakage until you start to. But if you’re not sure what you need and take a ‘catch-all’ approach, you’re likely to encounter data paralysis brought on by too much data.
While it takes a bit more time to set up, tracking and reporting on only what you need will keep you focused on what matters.
3. Remove data silos and centralise your data sources.
Silos happen for all sorts of reasons. It may be that an upgrade to your CRM meant that some data was never transferred, or that your product team don’t have a system in place to share their data with marketing or sales (or vice versa), or that the recent adoption of a new software created a whole lot of new data that hasn’t been integrated with existing systems.
Centralising data will get rid of silos that many organisations struggle with. Once silos are eliminated, access to data organisation-wide becomes a possibility. Make sure that the key players in your organisation have access to the data they need to do their jobs.
4. Use data to support strategic and budget decisions.
You have to walk the walk. Once you set up the right analytics stack and data is being distributed to those who need to know, make sure you openly and explicitly use it to back up strategic, resourcing, and product decisions you make.
Talking about a data-driven culture is one thing, but making decisions on the basis of data insights sends the signal to the organisation that you’re serious about taking a data-driven approach.
Once you show the team how it’s done you can ask everyone else to do the same.
5. Deep dive into the data for insights.
A data-based strategy is powerful because numbers don't lie. As opposed to traditional marketing techniques like surveys and focus groups (where customers can tell you one thing and do another), when you track behaviour there is no interpretation bias and no room for disagreement. Only data. You can use data to:
- Track how website visitors are behaving
- Understand your customer’s wants and needs
- Identify friction points in the sign up or transaction process
- Optimise the website to grow conversions
- Decrease shopping cart abandonment rates
- Remonetise existing customers by selling them more of your product
- And that's just the beginning.
Schedule an hour once a month to look at your dashboard critically. Looking at the numbers is one thing, but ask yourself what the trends are telling you. Does the data bring up further questions? If so, make sure you get the answers.
6. If you don’t have the internal resources get external help.
Don’t wait to get started. As organisations of all types struggle to integrate data into their strategic frameworks they fall behind competitors who do this well and leave themselves vulnerable to disruptors who have data in their DNA.
While data analytics is something that must be internal and integrated into the business, the reality is that it’s hard to prioritise in light of the everyday pressures businesses face. To get where you need to be, ask for help. Experts will set up frameworks, up-skill your teams, and in the long run, save you time, money, and get you to your goal quicker.
About the author: Alexandra is the Head of Growth at DataMuse, a data and growth consultancy that specialises in monetising data and growing data ROI by mining data for insights with impact, developing and implementing robust data strategies, and centralising data silos. The founding team have 25 years combined experience in strategy, growth, and data analytics. Alex holds a BA from Yale University and an MBA from the University of Cambridge.
A version of this article first appeared on the LegalVision blog.