Analytics for Small Businesses to sail through COVID-19
Nokia, a former mobile giant, fell from the leading position as it was unable to read the writings on the wall. The systematic shift in mobile users towards adopting touch screen and android was overlooked by Nokia. It refused to modify its strategy and continued with Symbian and key-pad phones. As a result, the market was soon flooded with touch screen enabled android, and everybody wanted to get their hands on it. Nokia, having failed to realize this shift in trend, was left speechless. Many small and emerging businesses at that point, who caught up wi the new trend, became giants subsequently.
We live in a digital age, where the explosion of the internet has brought an endless number of people on the digital spectrum. It has resulted in a massive generation of data. Data, the new age gold, is being extensively exploited by industries to gain valuable insight into businesses and customers.
Analytics can help win in this fast-paced competitive world
In such volatile times the trends in business change with a blink of an eye, which warrant businesses to adapt quickly or perish altogether. Strategies based on business analytics help make informed decisions and get a competitive edge.
Data analytics is helping small and medium businesses to sustain. It provides businesses with a level playing field against the established ventures and also from the emerging competitors. It has created endless possibilities for these enterprises, who are ready to reckon the power of analytics. Data Analytics, Visualization, Data Mining, Business Intelligence, etc. can collectively help small and medium businesses achieve their true potential. In a research, it was found that
1/3rd of SMBs using analytics in new ways are considering moving their analytics workloads to the cloud as a result of COVID-19.
Multiple ways for SMEs to benefit from Analytics
Data analytics help provide SMEs with detailed insights about their business. It can help small businesses become smarter, more productive, and more efficient. When used correctly, it can create a noticeable competitive advantage, while boosting both conversions and revenue.
1. Risk Analysis Profiling
The ability to identify the liabilities of a product, and work to remove them before the product goes live or the ability to foresee upcoming challenges, and working on them is risk analysis and aversion.
Small and medium businesses operate on a shoestring budget. It takes away the liberty of experimenting with products. A failed product might spell doomsday for a lot of these entities.
Data analytics helps in preventing these mishaps. A product is tied in with an array of social and economic factors that determine the success of a product by gathering the data for analytics in the respective sectors. Analyzing the news, social media, and customer preference data provide valuable insight that can help with risk aversion.
2. Enhance Data Security
Data forms one of the most valuable assets for any company. Strategies, product information, future prototypes, and customer information are some of the most sensitive data which a company holds. Protecting them is very important. Data analytics scans the entire system of the businesses and forms data mapping. The data mappings help in identifying vulnerabilities and threats.
Data analytics also provides standard storage procedures to the SMEs. These storages are built with high-security features and are in sync with industry standards. The data held within the systems are also more secure by deploying in the analytical framework.
With recent upgrades in the legal requirements, some countries have made a breach of data a punishable offence. GDPR is one such regulation implemented in the EU to protect consumer data.
3. Generate new streams of Revenue
Analytics can help businesses branch out to newer streams of revenue. Market research based on analytics of customer data and market trend provides insight into new products and services which are required. The small and medium enterprises can step up to ensure that the market requirements are met. The products which are developed around customer requirements ensure a greater probability of success.
Analytics can help businesses identify new target groups, on which they can focus their efforts. Also, the data held within the organization can be monetized.
4. Enhance productivity
Identifying the bottlenecks in the production line, mapping the correct talent to the work, managing the costs, forecasting the demands, targeting the correct audience, and developing the necessary strategies is required by all businesses. These are some of the areas if executed properly lead to productivity enhancement along with cost-saving.
Data Analytics assists in all the above fields and encompasses many more. Thus, promising to prove cost-efficient to any business which chooses to deploy the power of analytics.
As a result of pandemic, it was seen that
55% of companies are using data to improve efficiency and rely on it to predict changes and outcomes
The application of analytics can also apply to the production lines. Information about material effective costs, lead times, and performance can be obtained. Efficiency and productivity will improve. It will lead to an increase in profits with cost reduction.
5. Identifying your Audience and Develop customer-centric approach
Most small and medium businesses have small operational geography. Operating in small demography also implies that these businesses can develop a more direct relationship with these customers. Focussing on their likes and dislikes, basing the products or services on their requirement, and marketing with data analytics, helps these small businesses gain a competitive edge over the big business houses, which mostly work on a macro approach. Due to COVID crisis, a study found that
47% are using data to improve interactions with their customers
Data analytics helps businesses develop this approach by providing them with real-time market data. It further helps in identifying your recurring customers and based on their preferences a more comprehensive strategy can be devised.
6. Feedback Analytics to Improve Operations and Product Development
With data analytics, the received feedback on products and services can be collated and trended out to analyze the strong and week points of the product or services. It provides a baseline to where maximum improvement is required.
The same approach can also be employed for pilot products when it is first launched for a limited audience. The response of the people can give directions to the business on areas to improve before going full scale.
Analyzing the products or services which are most popular among the audience helps the business in making an informed decision on ramping up of production or enhancement of services.
7. Help the business become future-ready
With data analytics, these companies can gain valuable insights into strategy making. Predicting the viability of a decision helps the business decide whether it is in their interest to pursue the same. Eliminating the need for trial and error to arrive on a correct strategy not only helps these companies save money, but also equally valuable time.
Trends of the market made available by the data analytics also help these companies make informed decisions considering both the parameters of the present and future. The informed decisions help the SMEs grow in a sustained manner.
8. Provide Competitive Advantage
SMBs can get a competitive advantage through the proper use of data analytics. It can provide insights into the activities of competitors. Analytics can help understand weak areas in comparison to the competition, which can help in planning better strategies. Having a step ahead in the race is always helpful.
For small and medium businesses, operating on limited resources, performing without a safety net, and having access to a confined audience are some of the difficulties. The disadvantage of not being in a level playing field, and competing with big companies with many resources at their disposal, adds to their woes.
It thus becomes increasingly important for them to engage the power of data analytics to enhance productivity, target the right audience, make informed decisions, and formulate the best strategy.