Businesses all over the world are turning to data-driven decision making
It’s not a fad, and it’s not a trend. Companies that have ignored the value of data-driven decision making are falling behind while their competitors race ahead. Fortunately, data isn’t a secret; here’s the good news.
It’s not complicated…
Businesses that leverage data have already seen substantial improvements across their organizations in areas as diverse as customer retention and revenue growth. With the tools available today, the ability to generate insights and translate data into results has never been easier.
In This Article:
- What Data-Driven Decision Making Actually Means
- Why Gut Instincts No Longer Suffice
- How Digital Experience Analytics Platforms Fuel Results
- The Real Benefits Of Data
- Getting Started With A Data-First Approach
What Is Data-Driven Decision Making?
Data-driven decision making, as the name suggests, refers to the process of gathering and analyzing information, often tied to KPIs, and then translating it into insights to inform the decision-making process.
In plain terms, this means moving away from hunches and past experiences towards relying on facts and metrics to guide strategy.
This could mean customer behavior data, website analytics, customer feedback, sales figures, or any other valuable insights your business is generating. The key is that this information is used to guide internal business decisions.
In order to do this, you need a platform for your data. More specifically, you need a digital experience analytics platform, which enables you to capture, monitor, and analyze user behavior throughout the user journey across your digital touchpoints.
If you have an experience analytics platform like Quantum Metric, you can get a real-time, digital-first view of how your customers are using your website or mobile app so that your entire team has the insights they need to optimize, fine-tune, and deliver the best possible digital customer experience.
By using this kind of digital experience analytics platform to collect data on the performance of their digital channels and the user journey through their apps or websites, your team will be able to make informed decisions based on concrete data rather than blind guesswork. And when you’re not guessing, you can start to deliver on some of the real benefits that data can bring.
And what are those real benefits?
Why Gut Instincts Don’t Cut It Anymore
For a long time, business leaders could get away with making decisions based on experience.
They could see a problem on their website and guess as to why it might be occurring, for example. However, as the digital-first customer experience market has become increasingly sophisticated and complex, those old ways of operating are no longer enough.
The market is now so competitive that there’s not much room for guesswork. Customers are more demanding than ever, and new competitors can emerge overnight. The only way for businesses to stay ahead of the curve is by reacting as quickly and efficiently as possible to shifts in the marketplace as they are informed by the insights the data is providing.
A recent survey showed that 90% of companies consider data and analytics critical to their business strategy. If you’re still relying on gut instincts, it’s time to make a change.
You may think you have a good read on your customers, but without data, you’re just making informed guesses. You may have a good idea of who your target audience is, and you may even have a good grasp of what your customers need, but your guesses could be very expensive mistakes.
Data helps remove the guesswork.
The Real Benefits of Using Data
Data-driven decision making provides substantial value to organizations across the board.
Here are just some of the benefits that businesses can expect from implementing this approach:
Better CX
It goes without saying that if your team has a better understanding of what your customers need, then they’re able to create better and smoother experiences to meet those needs. This, in turn, leads to higher customer satisfaction levels and, as a result, more repeat business and customer loyalty.
Increased Revenue
Businesses that make a real and demonstrable commitment to delivering great customer experiences are often able to see substantial growth in their revenue streams. It has been estimated that companies focusing on CX see 80% revenue increases. If you need another reason to invest in data, there you go.
Decreased Risk
There is always a risk element associated with any decision a business takes. That’s not something that data will ever be able to remove completely, but what it will do is help to ensure that leaders are making informed decisions with an increased level of certainty.
By having a better understanding of the context around any decision being taken, the decision-makers are far less likely to make a costly mistake. It’s a bit like crossing the road. If you look both ways, you’re far less likely to get knocked over than if you take a chance and simply dive across.
Faster Problem Resolution
Businesses that make the move to data-driven decision making will also find that they’re able to solve problems much faster. Instead of spending weeks on investigations, they’ll be able to drill down to the root cause of issues much more quickly and address them.
Competitive Advantage
Businesses that aren’t harnessing data to its fullest potential are inevitably slower than their competitors are when it comes to moving in a particular direction. By using data to make better, faster decisions, your business can develop a real competitive advantage over those competitors who are either unable or unwilling to change.
Getting Started With A Data-First Approach
When it comes to changing to a data-first approach, most businesses think the process is more challenging than it is.
Don’t believe me? Well, start by identifying the key metrics that are going to have the most substantial impact on your business. This might include conversion rates, customer satisfaction scores, or even website engagement metrics. Whatever your KPIs are, ensure you have the right tools and processes to measure and track them.
The next step in the process is to ensure that your teams are equipped with the right technology to help capture the data required to make more informed decisions, and this is where analytics platforms come into play.
Once you’ve covered these two steps, it’s all about culture. Your team must buy into this approach, which is why it’s vital that all stakeholders in your organization fully understand the value of working in this way.
If your teams are using tools that they’re not familiar with, it could have a significant impact on their performance. So, invest in the necessary training to ensure that all of your stakeholders understand the value of using this kind of data.
Finally, you need to start small and build. Pick one area of the business that you want to focus on and work from there. Make a name for yourself in this area, and then expand this across the rest of the organization. Slowly but surely, you will build a momentum that will take your business forward.
Wrapping Things Up
There you have it: the benefits of data-driven decision making.
Companies that are making the move to this approach are experiencing the real benefits of working in this way.
Those that are ignoring it are already falling behind, and it’s not too late for you to get on board. You already have all the tools and the data. You just need to make the decision to start using them.
To summarize:
- Data-driven decision making refers to the process of using facts and metrics to inform business decisions
- Gut instincts alone are no longer enough in today’s digital-first world
- The real value of data comes in the form of digital experience analytics platforms which provide an abundance of customer insight
- There are a multitude of real benefits to data, including increased revenue, better customer experiences, and reduced risk
- Moving towards a data-first approach requires identifying key business metrics and then making sure your teams have the right tools to work with. Finally, a data culture needs to be nurtured within an organization if the full benefits of this approach are to be reaped.
The change has already begun, and the companies that are at the forefront of data-driven decision making will be the ones that lead their markets in the future.
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