Questions That Most Businesses Fail To Answer
More or less, every business has some forms of reporting, e.g. sales result or customer demographics etc. Even with these available data, all businesses fail to answer these questions……
Unless they have Big Data and they maximize the power of BI.
According to Simon Sinek’s Golden Circle Theory, “What”, “Why” and “How” are the 3 fundamental questions of every business. Try to answer these 3 questions for your business using the data on your hands right now. You have 2 minutes.
What result have you achieved?
Why achieve such result?
How you can improve?
If you can answer it within 2 minutes, congratulations, you are putting your BI into good use. If you find this challenging, it is a good idea to continue reading this article.
Ever wondered how Google and Facebook understand your buying preference so well? Every product you click on, every review you read, every item you put in your basket, and everything you finally buy is tracked. All of those little data points add together to form a picture that describes your buying behaviors and tendencies, what you shopped for, what you viewed, and what you eventually bought. When all this data is gathered, it will become Big Data. To better understand consumers, big data will be analyzed and transformed into useful insights with big data analytics. Big Data Analytics refers to the practice of analysing massive amounts of various data sets using advanced analytic tools. These advanced big data analytics tool are being created as traditional computing techniques cannot process this big data. These are the four different types of big data analytics and each of them could support business in making different decisions and answer the fundamental business questions instantly. The 4 Types of BI Analytics To Answer Your Business Questions
Descriptive Analysis (“How Are You”)
This answers “How Are You” in your business context. This is the most common among the businesses, where we use graphs to show the amount of sales achieved, productivity per outlet etc.
If you are a shopee seller, you might be familiar with one of the function named “business insights”. With this function, you could see the overall sales and orders in every many across the year. This could help you to calculate your monthly sales performance easily as shown below.
Source: Shopee Seller Education Hub (link: https://seller.shopee.com.my/edu/article/503)
It gives us basic information to know how well our company is doing, however what is lacking is the amount of insights like what issues we are facing, customers’ preference, what we can do more etc.
Diagnostic Analytics (“Why Is It Good Or Bad”)
By using diagnostic analytics, businesses can understand the possible reasons why certain events like high page visits but low sales happen. It could be due to various reasons such as high shipping fees, unattractive visuals, lack of promotion or free gift. For example, you can make the deduction that your frequent customers like free gifts along with any purchases from your shop when there is a sudden spike of sales as the free gift promotion campaign is launched.
Predictive Analytics (“What Next”)
Through predictive analysis, businesses can forecast the future market trends and events. Based on previous sales records, businesses can use this analytics to obtain insights and supporting data for future business decisions. For example, if you are selling homemade cookies. You would want to know when is the period to make more cookies and when is the period to make less cookies. Thus, by knowing the number of your virtual shop visits during certain months across a year, it serves as a guide on how much cookies you should make to avoid overstock or understock issues.
Prescriptive Analytics (“How To Solve This”)
Prescriptive analytics is the most underused form of analytics. However, with the aid of prescriptive analytics, it will help businesses to shortlist the solutions with the best outcome. There are so many types of advertising strategies like keyword search ads, Google Ads, Facebook marketing ads and many more that are available on the market. As a business owner, you would definitely want to find the best marketing strategies that provide the best return of investment. For instance,you would like to determine the best advertising strategies that could help gain more sales. With prescriptive analytics tools, it would provide you the insights on which ads strategies contribute more sales gain, hence helping you to determine the ads strategies that bring you most return investment.
It might be possible that you could still generate descriptive analytics by yourself on Excel. However, to conduct more advanced analytics like predictive and prescriptive. It might take more than a few hours to just compiled all the data you before even moving on to do the analytics. On the other hand, with business intelligence tools, you can now access all these data at your fingertips. If you are looking to customize your reports into insightful visuals that suit different management levels requirements, why not understand more about how our Business Intelligence solutions could help you?