Advanced analytics tools are changing the business world. It’s more than data, tables, and spreadsheets. It’s a way to predict your next move, win more customers and reduce risk. Here’s how we think about advanced analytics.
What Is Advanced Analytics?
Every company will define it differently. Some choose to emphasize the inputs – all the data you can analyze. Others want to emphasize the brand new insights you can pull from your data. At Blue Orange, here is how we define advanced analytics.
Advanced analytics is a combination of software and practices that transforms your data into problem-solving business insights.
Each part of the definition is significant, so let’s take a moment to unpack each piece.
- Software. For advanced analytics projects to succeed, you need to select the right software. Relying on Excel or outdated business intelligence (BI) applications is not going to cut it.
- Practices. You need an analytical skillset to draw value from analytics. Specifically, you need to know the right questions to ask, critical thinking skills to evaluate your data, and the knowledge to present advanced analytics effectively to your stakeholders.
- Data. Advanced analytics requires significant amounts of data. This could be your internal company data (e.g., marketing analytics, customer data, etc.) or data from the marketplace. We can help you with data evaluation so you can focus your analytics efforts in the right areas.
- Problem Solving Insights. Processing data does not move the needle forward on your business. You need insights that solve your problems and the determination to act on those insights.
Now let’s explore how advanced analytics can benefit your organization.
How Advanced Analytics Benefits Your Company
For advanced analytics to produce value, you need to connect it to your business problems and goals. To illustrate how advanced analytics can help your company, let’s focus on one of the most common business goals: acquire more customers.
By implementing advanced analytics, you can acquire more customers in several ways. Let’s assume you already have a website with 10,0000 visitors per month, and you have an active customer base. With advanced analytics, you can get more customers in the following ways.
- Experiment with lead generation. Use analytics to determine which offers (e.g., 10% discount vs offering a bonus product) generate the orders. Likewise, Blue Orange can also help you identify your most valuable customer segments so you can make the most of your marketing dollars.
- Clarify your most profitable customers. Some customers are more profitable to work with than others. Use analytics tools to identify common characteristics of your most valuable customers (e.g., you might find that customers with more than 100 employees are the most profitable). Based on that insight, you can adjust your marketing accordingly.
What Keeps Advanced Analytics Projects From Succeeding?
If you have tried advanced analytics before without results, you’re not to blame. Implementing this type of advanced technology is not easy. To make this type of project succeed, there are three barriers you need to overcome.
Barrier to Advanced Analytics Success: Choosing the wrong business problem
Advanced analytics has its limitations, like any methodology. Put, it is better at solving some problems. There are proven analytics strategies to improve sales and marketing problems with analytics. Likewise, you can improve operational efficiency and supply chain problems. However, if your problem relates to leadership, company culture, and other qualitative issues, it may not be the right solution.
Barrier to Advanced Analytics Success: Focusing on poorly developed analytics questions
The questions you ask shape the answers you have with analytics. For example, if you focus on trying to find tiny improvements, you are unlikely to generate significant wins. For the best results, we recommend basing your analytics questions on business goals and analytics best practices. Let’s illustrate how to overcome this barrier with an example.
Ineffective question: How do we make more money?
Effective question: How can we increase the percentage of customers who purchase a 1-year product warranty?
Barrier to Advanced Analytics Success: Failing to act on analytics insights
When you receive a data insight that goes against your habits or the traditional way of doing business, what will you do? If you are like most companies, you will ignore the data. Sadly, this is a common problem. In 2019, the Harvard Business Review reported the following findings based on a survey of C-level executives:
- 52% admit that they are not competing on data and analytics.
- 69% report that they have not created a data-driven organization
If your technology team builds an advanced analytics capability and executives ignore the results, you cannot be surprised by the results. Solving this barrier does not require different technology. Instead, it requires a champion – a senior executive willing to take chances on advanced analytics.
The Path To Advanced Analytics Success Starts With Blue Orange
You don’t have to solve these barriers to advanced analytics success on your own. Reach out to Blue Orange today to discuss how we can address these challenges for you.