“The price of light is less than the cost of darkness.”
– Arthur C. Nielsen, Market Researcher & Founder of ACNielsen
The above quote by Arthur C. Nielson describes the importance of analytics and data in today’s competitive world. It may cost you a few bucks to develop a proper analytics team but the return on investment in the long run could be huge as you would have a lot of insights into your own business.
On the other hand, you can always choose to skip these costs and carry on running your business without actually knowing how your business is doing but the cost that you may have to pay could be a lot higher. The real thought is: “Can my business survive in this competitive world without analytics?”
What is analytics and why is it important?
First, we need to understand what analytics is and why is it important. Analytics provides you with insights into your business. These insights act as facts upon which you can base your decisions. Therefore, it is safe to say that analytics facilitates decision making.
What is the use of all this data?
Understand what works
As mentioned earlier, analytics are facts and, as we all know, facts don’t lie! Analytics can help you understand what is working for your business and what isn’t. It helps you to track results based on your traffic and ad campaigns. It can also help you identify successful sources of your traffic, i.e. you can find out if your Facebook ads are more successful than your Twitter ads and shift your funds accordingly. By analyzing your click through rate and comparing with your conversion rate, you can analyze the probable causes that prevent your traffic from converting.
Measure ad campaigns and drive conversions
Let’s say you run five different ad campaigns, how will you find out which one is most effective? By going through the data, you will not only be able to find out which campaigns have the highest conversion rate but you will also be able to determine how much you are spending per lead. This will tell you the most productive ad campaign and can save you a ton of money on poor ads that don’t drive any revenue.
Helps you improve
This should come as no surprise that by using the analytics you have at your fingertips, you could easily identify potential opportunities or areas of weaknesses. Furthermore, you can improve these areas so that your business becomes stronger. For e.g. you could realize that you are gaining a lot of traffic from a particular region and expand your business in these regions. By using analytics to understand the market demographics, you can better satisfy your customers properly. After all, isn’t that what it’s all about!
To answer the simple question asked earlier. NO!! You business cannot survive without analytics. Think about it this way, would you rather spend a little money now and make a lot of money later or would you rather save a little money now and lose a ton of money later? Which of these two options you choose is up to you!
Author: Sunil Joseph Source: GeekyTechFacts