Data’s become a valuable commodity for businesses in recent decades. Popular hiring websites have multiple listings for data scientists, data analysis experts, data architects, data engineers, and other experts who work with data.
Many business owners are looking for new technology to improve operations. It’s undeniable that accessing the internet enables companies to research suppliers and promote goods and services. While someone who doesn’t work with computer programs may understand the business benefits of the internet and social media, data analysis and how it benefits their business may be harder to identify. Let’s explore data analysis, what it is, how it works, and how your business can benefit from data analysis.
Data analysis is a process used to interpret data.
What is data analysis? Data analytics software compiles data and modifies it, enabling companies to understand the significance and make informed business decisions. Data analysis involves taking raw data, reviewing it, and organizing it into data sets. Data analysis tools use algorithms and events to transform data into meaningful information, offering actionable insights.
Ultimately, data analysis produces reports based on the analyzed information. Text analysis from customer surveys could be used to determine where your clients live, work, and interact online. Data mining programs could supply information about supply issues, product demands, customer service issues, and other matters affecting your business operations.
For example, suppose you’ve heard reports that there’s a worker shortage in your area and companies are struggling to hire new employees. Data analysts can use data science tools to perform predictive analysis to determine how long the shortage will last or whether applications will decline further before increasing. Data analysts can also break down relevant information to determine whether the employee shortage affects all industries or whether it only affects customer service industries, such as restaurants and retail outlets.
How can your company benefit from data analysis?
Suppose a company wants to determine what type of marketing campaigns they should develop to promote new products. Data collection tools can gather information about their clientele and complete a statistical analysis to determine how many clients use different social media platforms. The insights gleaned from organizing and evaluating the data could help the company determine they’ve overlooked marketing opportunities on other platforms, such as YouTube, or yield higher sales when promoting products on Twitter. Valuable insights enable companies to focus their resources on untapped markets or markets that consistently perform.
Your company can utilize historical data to anticipate trends. For example, a resort in Maine may determine they enjoy increased demand from clientele during the fall, with most clients visiting their facilities as a launch point for leaf-peeping. Reviewing historical data can help you determine how many employees you need for different months of the year, when to open and close your restaurant or gift shop, or when to begin offering leaf-peeping tours. Companies producing software may identify trends revealing an increasing demand for specific types of apps or software programs. Identifying these trends enables the software companies to prioritize development projects to meet anticipated needs. When businesses have data analysts pose the right questions to appropriate data sources, they can be confident they’re receiving accurate and reliable data they can use to improve operations.
Companies can also use data analysis to address supply issues. Suppose your company produces diagnostic equipment used by hospitals and medical clinics to perform medical tests. Data analysis could identify supply chain issues that could affect your business. For example, if oil costs increase, gas prices will rise. This means it could cost more to transport equipment to your clients. When companies anticipate economic issues, they can adjust their prices to prevent losses from rising production costs.
Data analysis involves cleaning and sorting data and turning data into usable information. Companies benefit from data analysis in multiple ways. Insights gleaned through data analysis inform multiple business decisions, such as when to hire staff, launch marketing campaigns, and adjust product prices.
