There are 4 connected devices per person and every human being is generating massive amounts of data every second of their lives. If analysts are to be believed, we have managed to generate 90% of all the data in existence in the last 2 years.And, of course, it will only keep on increasing.
But the real value of this data is that it can help generate insightsthat can be used to make strategic business initiatives more effective. This has driven a concerted move among organizations towards data-driven decision making.
The top management now consumes data in the form of highly intuitive dashboards to arrive at major decisions. Data visualization products have created an industry niche of their own to make data easy to view, understand, and digest.
Data-driven decision-making is backed by robust data-crunching enginesthat process the data to make it analytics-ready. Companies now have the flexibility to collect data, not only from their internal CRM and ERP systems but also collect merge and analyze data from external sources like social media, and leverage news sources like Bloomberg, etc. to drivefully informed decision-making.
Today, all the businesses are defined by the 7 Ps, i.e,Product, Price, Promotion, Place, People, Processes, and Proof or physical evidence. Let us look at how the 7Ps can be streamlined with data analytics.
Data-driven product development. A product today can be a web page or app for a bank or an automobile. But whatever the product, industries are leveraging analytics to improve their product development. Customer data and market trends are being analyzed to streamline and optimize product features. Everything from insurance products to mobile phone plans get optimized based on the features likely to be used the most. Even premium automakers have introduced virtual trials to study which features the customers will use more to influence and optimize their design.
Pricing Decisions. The days of single flat pricing are long gone. Companies have realized that by following a flat pricing model they may be leaving a lot of money on the table at one end and losing customers due to sticker shock at the other. Companies have brought in the concept of differential pricing powered by analytics to offer custom pricing options. Have you seen the prices for an airline ticket change as you search more for it or the change in the room rent on Airbnb depending upon the number of hits? This is essentially an analytics-driven intelligent decision. The impact is a more personally relevant price that can positively impact the bottom line too.
Promotion. Ad Analytics. Rings a bell, doesn’t it? Gone are the days when one used to paint the whole landscape with one broad brush stroke. Companies are using data to customize their ad strategies by trying to reach out to their “most likely” customers.They are aiming for a strategy that helps them grab the attention of their target where they spend themost time when online and at the most opportune time. Companies like Marketo andHubspothave created a marketing automation economy around this very value. An analysis of the email campaigns or the video ads consumption patterns helps organizations find, target, and qualify the customers as they move through the sale process.
Place. States in the USA have started to predict and prevent crime by using analytics to understand where the next crime will happen. Similar principles were employed to ensure that the antidotes for the H1N1 virus reached the places where it was likely to spread the most. Similarly, organizations are crunching data to understand which place is bestsuited to launch their products, open their stores next, etc. And they do this by leveraging data.
Process optimization. Business processes are being made more efficient. Supply chains, warehousing, and fleet management are being optimized. Manufacturing workflows are being automated. And data is driving all these process transformations. Sensor data from the factory floor is being collected to optimize the maintenance process and bring in cost savings. Organizations are also realizing revenues from new sources like leasing idle equipment. If the data can be generated it can be analyzed for process improvements.
People. HR analytics is the new frontier conquered by data. This data is being leveraged for hiring, to understand the level of employee engagement, and to improve performance levels. It is also being used to understand which employee is losing interest and might jump ship. Social media and text analytics are being employed to screen those candidates who might be the best fit for the organization. HR is about people. But the data behind those people makes for powerful HR strategies.
Physical Evidence. Depending upon the kind of sector and the kind of target market it wants to cater to, organizations trying to leverage data to showcase itself in the best possible way. Analytics is helping organizations address compliance needs better and to report transparently on the things that matter. Customer sentiment analysis on social media and in the media is helping organizations proactively identify looming threats to the reputation of the brand and to define what sort of countermeasures could be taken. Data analytics are helping brands and companies understand exactly what evidence is likely to prove convincing in the face of specific risk and to provide exactly that evidence. There is no longer any doubt that organizations across the board can benefit from a data-driven approach. But rather than looking at this as an abstract promise, understanding the possible impact on the 7Ps of business can help prove just how real that promise it.