By Michelle Keldgord Jun 23, 2022

Entrepreneurship has taken center stage in 2022, but creating a business is no small feat. There are many elements that are critical to forming a small business, from generating an idea to marketing campaigns and sales. If you find yourself struggling in one area or another or looking to learn what are the key aspects of your business, small business data analytics can help.

If you’re new to the realm of data analytics (DA), you’re likely pondering the question, “What is DA, and how is it important to a business?” And that’s precisely what this article is here to share.

What Is Small Business Data Analytics?

Data analytics is the process of using four different techniques and procedures to investigate business data in detail. Data analytics aims to obtain essential insights about the business, leading to better decision-making, a more customized experience for users, enhanced operations, and more.

After discussing the four types of data analytics below, we will highlight several critical aspects of small business data analytics that play a significant role in getting a startup business off the ground successfully.

data results in visual format

Types of Small Business Data Analytics

When it comes to data analytics for business professionals, there are four main categories. Each category plays a vital role for business owners. Here is a quick breakdown of the four types of DA.

The first and most popular form of small business data analytics is descriptive analytics. The information composed from descriptive analytics reveals overall performance and answers the question, “What happened in the past few days, weeks, or months?” For example, reports and analyses can show how much the company has sold in the past year and how many repeat customers the company is gaining.

While descriptive analytics answers the question of what happened, diagnostic analytics answers why it happened – which is almost more important and valuable to a small business. Through historical data, companies can discover why their sales increased or decreased, why they’ve gained or lost customers, or why a specific product is over or underperforming. From there, the company can discover what works and, more importantly, what doesn’t.

Predictive analytics focuses on utilizing descriptive and diagnostic reports to answer the question of what will happen in the future. With historical data, predictive analytics can pinpoint potential future problems such as things that will cause customer dissatisfaction and breakdowns within the mechanical elements of the business.

Last but not least, prescriptive analytics is data contrived from the three prior categories: descriptive, diagnostic, and predictive. This in-depth look at historical data aims to genuinely guide the business toward positive decision-making. For example, a small business can see where further training is necessary through compiled prescriptive analytics. They can also make a confident decision on changes to essential things such as product pricing.

It Starts With Collecting Info

One of the key words found in “data analytics” is data. Without it, there can be no analysis. At this point, you know that DA will solve a problem, such as why a product is losing sales, or there are more break-ins at a specific in-person location. To analyze the situation and discover a solution, there must be data.

Data can be broken down into three categories: first, second, and third-party. The information can be quantitative or qualitative (numerical or physical).

Once data is compiled, it will be essential to “clean it” before being analyzed. This involves getting rid of duplicate records or unwanted irrelevant fields of information. You may also need to perform some general fixing, like eradicating typos and creating a streamlined layout. Information gaps may need to be filled, too.

How to Collect Important Info for Analyzing

There are multiple ways to put together in-depth data for analysis. Simply follow these four steps:

  1. Decide what information you want to be analyzed. The first step is to decide which info is most important to collect. For example, a retailer might want to know why one of their products outperforms the other.

  2. Create a timeline. Some data will be collected continuously, so observations can be made from long-time observations, while others will only need to be dissected for a short amount of time.

  3. Determine which data collection method you will use. There are many methods, from in-store traffic monitors to social media monitoring. You can also use surveys, online tracking, and transactional data tracking.

  4. Collect the data and observe it regularly. As soon as you begin collecting data, you will want to observe it to pinpoint trends and analyze it for future benefit.

Why Data Analytics Are So Critical for Small Businesses

Now that you know the basic introduction to data analytics for business, it’s crucial to understand how data analytics helps companies, especially small business ventures just starting out. Here are the top five ways small business data analytics are crucial.

1. Improved Customer Experience

The customer experience is an essential part of any business, whether you’re selling clothes online or running a dental office. Customers want a streamlined and personalized experience they’re happy with from start to end – and data analytics can help.

Data analytics can put together customer profiles that lead to an improved and customized experience for each user. For example, a retailer can see in-store and online sales trends and promote products to enhance overall purchases. They can also use data to discover which products should be encouraged at checkout, leading to more profit.

2. Informed Company Decision-Making

Making a serious decision on your small business can be daunting, but the task is far more manageable with data analytics. Thanks to predictive and prescriptive analytics, a company can get insight into how a decision will affect their company.

For example, a company may toy with changing the pricing of their product. Using data, the company can decide whether or not the change will have a negative impact on their company or whether it will reduce their overall financial gain.

3. More Streamlined Operations

Data analytics can also help when it comes to the overall operations of a small business, pinpointing bottlenecks and other production delays.

Here, we can use the retailer as an example once more. Data can show whether or not current vendors can support the production, especially during peak times such as the holiday season. Having this knowledge beforehand allows businesses to take the necessary steps to ensure streamlined operations, resulting in swifter product output and delivery – and satisfied customers.

4. Enhanced Security

Last but not least, small business analytics can improve the security of the business and customer in many ways – both in-person and online. For example, data can show which storefronts are at a higher risk of theft, allowing the business to create a plan of action for reducing incidents. Data can locate vulnerabilities within the system and patch them on an electronic level before something detrimental occurs.

5. Greater Revenue

Improved customer experiences, informed company decisions, streamlined operations, and safety all equate to one significant benefit: greater revenue for your small business. After all, even the best ideas can fail due to a lack of proper advertising, slow deliveries, and overall negative customer experiences. Ensure your company is making intelligent decisions and catering to the customer with DA and watch sales boom.

How DA Boosts Business

data results in visual format

Needless to say, the DA process is essential in all areas of a small business. Business problems addressed by big data analytics can be quickly rectified and customers can have a more positive experience. Here are just a few ways in which DA can elevate your biz.

Conclusion

Without proper business analytics and data visualization, even the best small business platforms can fail. DA is essential in all areas of small businesses, from improving customer experiences to streamlining operations and beyond. Now that you understand the introduction to business data analytics, you can apply it to your company and watch it thrive.

How Live Chat Services Can Boost Small Business

Small business data analytics are crucial for building a small business and allowing it to be productive and thrive. But DA isn’t the only way to boost small businesses. Another great way is to implement live chat services on your website.

A properly managed live chat support comes with a slew of benefits for your business, including the following:

Needless to say, managed webchat is a must for your small business, and Chat With Humans can help. We only charge $15 per valuable lead, making our managed live chat pricing affordable for companies big and small.

Chat With Humans offers more than just pays per lead, though. Our managed live chat services extend to sending visitors follow-up emails and promoting discounts and bonuses, ensuring you get the most from our managed live chat online services.



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