How small businesses are using data to compete with industry giants

How Can Data Analytics Help Small Businesses Compete With Industry Giants?

If there is one thing that businesses rely on to improve and scale in their industries, it would be data. Making decisions driven by data helps organisations to optimise growth and expenditure and improve the experience their customers receive.

Understanding data analytics opens up a world of possibilities for you in terms of future career opportunities. Within its range of online IT qualifications, Lumify Learn offers a range of data science courses that prepare you with the skills and knowledge you need to become a data analyst.

In this guide, we will discuss how a small business’ data analytics can be leveraged to give a business a competitive advantage. Read on to find out more about how big data and small businesses can work together to create targeted and personalised strategies that elevate these organisations above their competitors.

What is Data Analytics?

Data analytics involves examining, interpreting and applying insights from raw data to make more informed business decisions. These insights can be presented as charts, tables or presentations that clearly illustrate the findings and how they may impact the business in the long run.

A career as a data analyst involves using software tools and algorithms to sort and simplify data into tangible, ordered insights. The results gleaned from analysing data can be used to improve performance, identify opportunities and trends, and reinforce strategic decisions for businesses.

Small Business Data Analytics: Benefits for Businesses

Big data and small businesses can be a powerful force for change, potentially improving operations and streamlining workflows. Harnessing the power of data analytics has further benefits for organisations, including an improved customer experience and boosting retention and repeat business.

Improved Decision Making

The primary benefit of data analytics for small businesses is to guide company decisions with concrete evidence. Whether you’re garnering insights into customer preferences, sales trends or internal utilisation, data analytics for small to medium enterprises (SMEs) helps make informed strategic decisions in the future. 

Streamlined Cost & Expense Management

In analysing company expense records, organisations can identify areas where spending efficiency can be improved and overhead costs can be reduced. A small business’ data analytics can keep records of expenses, cash flow and supply chain costs, providing insights on how to optimise spending in the future.

Improved Customer Experience

Data analytics can also be used to improve a number of elements of the customer experience, including customer preferences, purchasing behaviour and target demographics. Armed with this information, your business can make more informed strategic decisions to offer these customers a more tailored and personable experience.

Heightened Operational Efficiency

Using the insights gleaned from data analytics can enable businesses to increase their operational efficiency. By tracking internal data from supply chains and staffing productivity, your business can streamline its operations and optimise its workload for busy or lean periods of operation.

Identify Competitive Advantages

Another advantage of using small business data analytics to drive changes in SMEs is the competitive insights you will receive. Gaps in the market and customer purchasing trends may persuade management to launch a product proactively, before any of your competitors can bring a rival to market.

Business Areas That Data Analytics Can Improve

The insights gleaned from data analytics can positively impact a number of different areas of a business, including both customer-facing and internal operations. Harnessing data analytics can contribute to a more profitable business that is favourably looked on by customers.

Customer Service

Data is an important part of improving customer service processes, improving satisfaction and personalising the service they receive. By identifying pain points, improving responses and more accurately identifying target markets, analysing data can lead to efficient and personalised customer service.

Finance 

Tracking your business’ financial records and analysing the data is an effective way of managing cash flows, expenses and profitability. The insights from data analytics can also be used to detect any anomalies in your financial records, such as fraudulent transactions or any other unusual activities. 

Sales & Marketing

By enabling targeted campaigns with a higher potential conversion rate, data analytics can increase a business’ ROI on its marketing campaigns. To do so, data analysts may investigate customer behaviour, track campaign performance and forecast leads and sales from past campaigns.

Logistics & Inventory Management

Data analytics can be used in a business’ supply chain to improve efficiency, maintain staff productivity and reduce operating costs. Using historical data on product demand, inventory turnover and supply chain efficiency helps to ensure your business is prepared for the upcoming season.

Web Analytics

Analysing web analytics helps to improve the experience for online users, as well as boost conversions from e-commerce. Tracking website visitor behaviour, analysing user flows and identifying any drop-off points all help to bolster a business’ online presence, eventually leading to an increase in traffic and conversions.

Master Data Analytics With Lumify Learn

If you own or work for a small business, data analytics could be a worthwhile industry to upskill in. Harnessing the power of data analytics has numerous benefits for businesses, and can be rolled out across multiple areas of the organisation. 

Data analytics courses from Lumify Learn provide you with access to tools, processes and strategies used throughout the industry to gather, sort, analyse and present information. Learn more about how data analytics can help small businesses by discovering the tools and techniques involved in one of our business analyst courses.