What Benefits Does Big Data Offer a Firm?
Firms can now collect a large amount of data generated by customers in value co-creation processes. These customer big data often exhibit the 3-V features: volume, velocity and variety.
The 3-Vs pose significant challenges for data analysis. They can cause firms to miss valuable insights and misunderstand the meaning of signals versus noise in the data.
1. Better Analysis
Big data analytics provides rapid analysis of a variety of sources of information. This analytics-based decision-making allows businesses to progress more quickly towards their goals.
For example, targeted ad campaigns can be created for individual customers based on their product purchasing and browsing history. This will improve customer service while increasing marketing effectiveness.
Likewise, analyzing historical and real-time business information can lead to cost reductions through new process efficiencies and optimizations. The ability to rapidly analyze data can also support better strategic decision-making, risk management and other important activities.
2. Better Decision-Making
The ability to use big data allows companies to make a lot of decisions with greater precision than ever before. Businesses can better understand how to spend their budget, minimize waste and maximize their ROI.
Data analysis helps in every department, from human resources to IT to sales. The more data that is available, the more a firm can learn about its customers and predict their behavior to improve marketing and customer service.
However, companies that want to succeed in the age of big data must put two things in place. First, they must foster a culture that emphasizes the importance of using quality data. Second, they must have leadership teams that can articulate a vision and make effective decisions based on data.
3. Better Optimization
Big data uses analytics to identify patterns in business operations, enabling optimization. Data analysis reveals issues that may be difficult to spot using other methods, such as hidden costs or inefficiencies.
For example, a pharmaceutical company might use big data analytics to identify office space and research labs that are underutilized, potentially saving millions of dollars by consolidating operations. Targeted marketing campaigns based on big data insights also provide a significant return on investment.
Companies can leverage big data to minimize maintenance costs and maximize equipment uptime by analyzing signs of potential mechanical problems. This is possible by analyzing data such as error messages, engine temperature and sensor information.
4. Better Customer Experience
Companies that use big data have a clearer view of their consumers and are better able to respond to them. They can make personalized offers, reduce customer churn and handle customer issues proactively.
They can also track consumer trends and forecast what might be popular in the future. This allows them to plan inventory more efficiently and avoid the risk of stock shortages.
They can also communicate with customers in the way they prefer – whether that’s via email, phone or text messages. This personalization is a key factor in creating customer loyalty. It makes customers feel valued and validated. It’s the small details that make a difference in this era of information.
5. Better Maintenance
Many businesses rely on big data to improve business operations and reduce costs. For example, it helps them optimize hiring and HR management and better monitor the performance of existing equipment and systems.
Big data tools and technologies are designed to handle semi-structured or unstructured data generated at high velocity. They can also be used to process traditional structured data as well, though this is less desirable.
The three Vs of big data – volume, velocity and variety – can be difficult to manage and process. However, the technology exists to do so and is improving rapidly. The resulting insights can offer significant competitive advantage.
6. Better Marketing
Big data analytics can improve the effectiveness of marketing strategies. For example, if your customer support team spends too much time answering repeat queries, you can use data insights to create a FAQ section on your website or implement a chatbot that answers these questions for customers in real time.
Big data also allows businesses to anticipate customer demand for new products and services. Companies like Netflix and Procter & Gamble develop predictive models to gauge the potential success of future products or services based on the results of previous offerings.
For more information about implementing big data into your business, contact Impact Networking today to learn about our digital transformation managed service solutions.