In the past, small business owners had to gaze in a crystal ball to get their hands on big data, while the CEOs of larger corporations bathed in it. However, this is no longer the case as business intelligence is now more readily available for small businesses as well. For years this powerful tool was the backbone of many successful companies as it allowed them to act on data-driven insight rather than pure speculation. What’s more, BI has the ability to process huge streams of data that otherwise wouldn’t be humanly possible, and seeing as how there are 2.5 quintillion bytes of data being generated every day, this has almost become a necessity. What are some actual benefits a small business owner can expect from implementing such a tool? Let’s find out.
Understanding customer behavior
Knowing who your customers are, their shopping habits, and more importantly, their likes and dislikes is essential for providing excellent customer service. This is where BI comes into play with its capacity to understand customer behavior by going through all of the company’s sales records, as well as other, more public data sources, such as social media and various other blogs and forums, to provide valuable insight. With the data collected, small business owners can work on upgrading and personalizing their customers’ experience further, in hopes of driving more sales. A happy customer is a loyal customer, and knowing exactly what makes them tick will ensure that a successful retention strategy is in play.
Identifying and predicting trends
Sometimes anticipating customer needs before they even arise can be hugely beneficial. Picking up on the latest trends before your competition is a real game changer. Luckily for us, BI can actually make sense of big data to the degree of finding clear patterns which are relevant for identifying trends, as well as predicting them. This predictive analysis is absolutely vital for making informed business decisions that would, otherwise, be mere guesswork. It will, therefore, allow small business owners to funnel their resources into something more lucrative with almost no risk involved and significantly increase their profit margins in the process.
Improving operational efficiency
Another thing worth mentioning is how BI helps you organize the internal structure of your business. Small business owners simply don’t have the luxury of paying staff members that don’t deliver but they have no real means of knowing who these low performers are. Well, sophisticated business intelligence software can help you to get rid of such managerial inefficiencies by pointing out the areas that need improvement. Naturally, this saves entrepreneurs a lot of time and effort and opens up their business for expansion. Indeed, growth is the most exciting aspect of any small business venture and allocating resources smartly plays a huge role in its development, especially early on.
Scouting the competition
Unfortunately, understanding all the intricacies of your business is simply not enough for achieving success because your business isn’t located in the vacuum but in the open market with thousands of similar enterprises vying for domination. Consequently, you need to be more aware of what your competitors are up to if you wish to outsmart them. What are their services and products? What’s their target audience, and how does it differ from yours? These are just some of the basic questions you need to answer. In addition, once you’ve gathered this intel you can then proceed with the implementation of strategies that will effectively set you apart from your immediate competitors. This, of course, will enable you to stand out from the crowd a bit more and get you noticed.
Determining optimal pricing
Finally, the pricing of your products can affect the final outcome of your sales and whether or not you’ll earn a profit at the end of the day. Yet, the answer is somewhere out there buried beneath terabytes and terabytes of data you need to dig through. This is why big corporations had the edge for all these years as they reaped the rewards of their BI pricing strategies and inventory management. By analyzing big data, it is easy to determine the right price tag and identify the products that are not selling very well.
To sum up, with big data not shrinking in size anytime soon, powerful tools such as BI are a necessity for adequate business operations nowadays. The benefits are there, small businesses just need to reach out and grab them.
Guest Author, Raul Harman, s a B.Sc. in Innovative entrepreneurship and has a lot to say about innovations in all aspects of digital technology and online marketing. While he’s not enjoying travel, football and great food, you can find him on Technivorz.com.