Businesses today are increasingly dependent on data to stay competitive. In order to grow, many companies are turning to data analytics as a way to gain a competitive edge. According to Statista, the global market for data analytics is expected to grow from $65 billion in 2015 to $221 billion by 2020. 

Moreover, Gartner predicts that by 2020, almost three-quarters of all businesses will have some form of data analytic capabilities. While data analytics is important in and of itself, it can also lead to even more beneficial results. To see why, let’s take a look at the top five benefits you can expect from data analytics in your business.

5 Benefits You Can Expect From Data Analytics In Your Business

Better Decisions & Increased Profits

Data analytics has the power to transform your business by helping you make better decisions. Data can help you identify trends, spot emerging patterns, and discover new insights that can guide your strategic planning. These insights can help you make better decisions, including the choice of which customers to target with your marketing and sales efforts, as well as the choice of which investments to make. Data can also help you better forecast your costs and operations, optimize your supply chain, and increase your profitability.

Better Customer Experience

As you begin to realize the benefits of data analytics, you might start to see an even bigger return on your investment. Data analytics can help you create a better customer experience by making it easier for you to understand your customers. By integrating data from your customers’ past purchases, interactions with your brand, and other relevant sources, you can discover what your customers’ needs and wants are—and then try to meet those needs and wants. Offering a better customer experience can lead to increased customer retention and significantly reduced churn rates.

Automated Business Processes

Data analytics can also help you automate business processes. Business processes are the tasks and functions inside any company that need to run smoothly and efficiently. By automating these processes, you can free up your employees to focus on what they do best. Moreover, as data analytics becomes more and more important, you can be confident that these processes are running as they should. The data analytics team can also help you identify areas where you can increase efficiency by making use of data to inform better decisions.

Accurate Predictive Analytics

With data analytics, you can discover new insights and make better decisions based on data. However, the data itself needs to be accurate—or else the analytics are worthless. Inaccurate data can lead to misleading or inaccurate conclusions. For example, let’s say you have a marketing team that believes there is a high chance of rain tomorrow. 

If the weather forecast is wrong, your marketing campaign will come to a screeching halt. Inaccurate data has similar consequences, with the potential to damage your business. For example, your sales team might report that a certain sales territory is unprofitable, when in fact the data shows that it is a highly profitable zone.

Predictive Maintenance

As important as it is to collect and analyze data, it is just as important to keep the data useful to you. This is where predictive maintenance comes in. Predictive maintenance is the process of using data and analytics to keep your equipment running at peak performance. For example, a machine that is 20 years old and operating at 80% capacity is generating a lot of waste and costing you money. 

However, by using data and analytics, you can determine when a machine is near the end of its life and take action to prevent a major crisis. In this case, predictive maintenance is better able to save you money by alerting you before a machine breaks down.

Data-driven Decisions

Finally, you need to make sure that your data-driven decisions are trustworthy. For example, let’s say you want to invest your customers’ money in a particular business opportunity. Before you make that decision, you should know if it is actually worth the customers’ money. 

The best way to do that is to run an analysis on the investment and make sure that it is worthwhile. If the analysis shows that the investment is likely to be profitable, then by all means go ahead and make the investment. If the analysis shows that it is not likely to be profitable, then you need to carefully consider whether it is the right decision for your customers.

Bottom Line

Data analytics has the power to transform your business by helping you make better decisions, better customer experience, automated business processes, and accurate predictive analytics, as well as data-driven decisions, all of which are important for a thriving business.