How harnessing the power of data can radically transform your business
Information is power. For small businesses, it can make the difference between leaving your competition in the dust and choking in their wake.
But there’s just such a lot of it. The sheer quantity of data out there can be overwhelming.
Chances are, even as a small operation, you already have so-called ‘big’ data. It’s there in your social media feed and your email newsletters. It’s in your transaction records and payment data.
The challenge is working out what data to collect, how to read it and, ultimately, what to do with it. Equip your business with the right tools and big data could quickly become your biggest ally.
Why big data matters for small businesses
The most common use of big data is customer analytics, according to research by Datameer. Knowing who your customer is, and what drives them to your business offer, is crucial. Harnessing that knowledge to adapt and improve your offer could be a game-changer.
Small businesses actually have a potential advantage here: their agility. With fewer staff and overheads, your company can quickly adapt to new trends and knowledge. Sure, having sophisticated tech, analytics and a department of number crunchers means the behemoths can gather big data quickly. But it also means a huge overhaul (and expense) should systems become outdated or irrelevant.
Big data has the potential to equip you with granular customer knowledge. If you use a tool like MailChimp to send out your newsletters, for example, you can gather and analyse information on click-throughs to personalise your communications.
Where to find big data
There’s the data you already have, waiting to be tapped into. Your point of sale (POS) system is invaluable for insights from stock counts to customer profiles and behaviour.
You can also broaden your data pool with methods such as A/B (or split) testing, which can be an effective way to measure the impact of varying newsletter content, for example, or website homepage layout.
Social media is another goldmine, not just as a way to let potential customers know how brilliant your brand is. It’s a way for you to get to know them, too. Engagement is crucial—from responding to questions to sharing relevant posts—and can help you get a sense of your market. And the advertising tool, Facebook Pixel, is invaluable for allowing you to understand and retarget customers who show an interest.
Gemma Whates founded All By Mama, an online marketplace for businesses run by mums, in 2014. She built her audience and brand primarily via social media. For her, data analytics and marketing go hand-in-hand. She told Small Business UK: “We review our marketing regularly. We still look at ways to reach our audience in a cost-effective way and when we spend against social media, we ensure that we are measuring the results.”
Big Impact, Low Cost Data Tools
Reams of data won’t be much use if you can’t translate it into useable insights. There’s a raft of tools available for businesses without huge budgets.
Customer relationship management (CRM) systems pull all your customer data—so you can respond with agility. Hubspot’s CRM is free, so makes a good start for smaller businesses who want to experiment before deciding whether to invest in more complex data-gathering systems.
Google’s range of suites includes Analytics, to trace customer engagement and behaviour, and Google Display & Video 360 for managing and tracking the effectiveness of marketing campaigns. Retail Business Services used Google Data Studio to automate the gathering of data and paint a “bigger picture” for its clients, primarily small local brands.
“There was no way to tell a story,” Justin Baynton, manager of Digital Analytics and Search for Retail Business Services told Google’s blog. “For people to understand data, they need a story.”
How to put big data to good use
Entrepreneur Gemma Whates advises “Make sure you look at the results of your campaign, review and make amends where you need to—you need to be analytical. Know your audience and refine your product. You can spend a huge amount of money attracting customers to your business, but if you are shouting the wrong message it’s wasted.”
Brainbroker, a digital marketing company, uses email marketing campaigns to gather invaluable data on customer needs and preferences. “Companies that are able to understand and leverage the insights from their data correctly and use it to drive their marketing initiatives will quickly see the fruits of success,” co-founder Jonathan Lemer said in an interview. “You do not need to become a fully-fledged data scientist, but I would really recommend understanding some of the fundamentals.”
Broken into bitesize chunks and viewed through the lens of clever analytics systems, big data could be a huge boost to your small business.