Big Data Analytics: The New Rocket in the Arsenal

Geoffrey Moore, a famous American author and speaker, once said, “Without big data analytics, companies are blind and deaf, wandering out onto the web like deer on a freeway”. With the field of big data analytics booming across the world, this quote becomes highly significant. It is the new trend that many experts are speaking about, and organizations are running with frantic speed to incorporate it into their functioning. But why is it so crucial? Let us start from the foundation.

To begin with, what is big data?

Big data is not only about the volume of data!

There are five innate characteristics which make big data so unique! They are called the 5Vs of Big Data. They are:

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⮚ Volume: The quantity of data. Big data has a huge quantity of data compared to the traditional lesser amounts of data.

Example: Facebook handles 500 terabytes of new data every day!

⮚ Variety: The various types of data. Big data is characterized by a wide variety of data with many types like audio, video, tables, text, etc.

Example: Twitter has tweets that are composed of text, images, and videos.

⮚ Velocity: The speed at which data is generated or the amount of time for which data is valuable. For big data, a lot of data is transmitted in a very short time, and its usefulness reduces as more time passes.

Example: Around 3.5 billion searches are done in Google each day, and this data needs to be acted upon fast for better outcomes.

⮚ Veracity: The quality of the data. In big data, the data needs to be accurate and truthful, and the sources and processing of data should be trustworthy.

Example: There might be duplication or ambiguity present in the data, which should be dealt with.

⮚ Value: It refers to transforming big data into actionable insights. It should be useful for the business and provide beneficial results.

Example: A company can know and cater to its customers’ needs more effectively by using big data of its customers.

So now we know what exactly big data is. But wait do you know?

Why is big data analytics important?

Harvard University professor Gary King said,

“Big data is not about the data. It is about the analytics.”

Analytics of big data generates lots of insights and advantages for a business. It will bring about a transformation and set it on the path to data-driven success! So, what are the immense benefits that big data analytics provides?

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So, let’s dig deep and see how brands are killing with big data analytics.

Significant cost reductions:

Costs are greatly reduced in various areas like customer relations, marketing, sales, supply chain, logistics, etc. through increased efficiency, optimization, and better operational processes. Let us see some of the areas in detail!

⮚ Customer relations: Gauging customer satisfaction is simplified, reducing the investment in feedback collection and assessment. It also enables highly personalized offerings, therefore decreasing the possibility of failed marketing campaigns.

Example: Netflix saves $1 billion per year on customer retention by using big data analytics!

⮚ Supply chain optimization: Well, if I say, “Jeff Bezos knows you better than you know yourself”, it won’t be wrong.

Amazon uses big data analytics for its “anticipatory shipping” technique, hence decreasing shipping and warehousing costs.

⮚ Logistics: The biggest problem with E-commerce stores (mainly garment and fashion industries) is managing the return orders. But with big data analytics, you can predict the possibility of a product being returned and take proactive measures to avoid this.

This saves a large chunk of the transportation and logistics costs associated with a product return.

Developing new products:

Another area where big data analytics has become a key factor is in developing new products. It sets the foundation for successful new product development, optimizing the entire process and boosting innovation. Let us see the aspects in which big data analytics improves the development of new products.

⮚ Consumer insights:

Product building for consumers >> Product building in response to competitors

The combination of big data analytics and traditional market research gives more insights into the consumers’ needs. This leads to a robust approach where innovation and ideation of new products occur less in response to competitors and more in an organic fashion. This strengthens the pillars of brand consistency, product quality, and expands market influence.

⮚ Product feasibility: Using the manufacturing and supply chain data, the product’s costs can be decided, and accordingly, the feasibility of production and distribution can be determined. Also, analysis of different factors like conversion rates for similar products, other product launches of the company, etc. can be done to produce profit estimates for the product.

⮚ Marketing strategies: By analyzing the target consumers, valuable insights are derived about the necessary marketing strategies to be used. Media planning, marketing, and advertising are optimized through consumer behavior analysis. Additionally, marketing performance is enhanced by real-time evaluation of the company’s marketing initiatives.

One good example is that of Amazon. It leveraged big data analytics to understand the process of how a customer purchases groceries and the interaction between the suppliers and grocers. Using this, it innovated and developed Amazon Fresh and Whole Foods, which is a grand success in the food retail market, providing immense value to consumers.

Better Decision-making:

One of the greatest advantages is that big data analytics lays the path to better decision-making. Big data will be effectively utilized only when it is used to drive forward strategic business decisions. Decision-making based on big data is crucial for an organization to be truly data-driven.

Which leads us to the question, how does big data analytics strengthen decision-making?

⮚ Real-time analytics: To provide personalized offers and benefits for its customers, Walmart uses big data analytics on real-time data and smoothly handles more than 1 million transactions per hour.

⮚ Optimized processes: The processes in business operations can be integrated and automated. Digital monitoring of production processes and analysis using big data tools has resulted in better productivity and fewer unplanned downtimes.

⮚ Customer-centricity: Big data analysis helps you observe customer patterns, trends, and behavior that gives you plenty of insights into the consumer base. This will greatly improve the strategies for customer retention and acquisition.

An excellent example is Marriott Hotels. They use big data analytics to make decisions regarding pricing. Dynamic pricing is implemented based on many factors like the local economic situation, reservation behavior, weather, etc. Through this approach, they achieved a revenue increase of 5% per room!

Conclusion:

We see that the potential of big data is enormous. By leveraging big data analytics, companies can climb the ladder of growth at a fast pace and reach great heights. It is high time that organizations adopt big data analytics and apply it extensively. Only by doing so will they be able to experience its massive gains and stay ahead in the game, for we are rapidly becoming a data-driven world now.

Alphaa AI a superAI data Platform for enterprises, that helps businesses to give data access to all users and ask questions on their data. It’s one of a kind natural language data tool built for users at any level and any skill.

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