Your business in data and numbers
Is the most important resource a company has today. Making sense of data and analytics is crucial for sustainable growth and performance year-on-year. But how well does your business understand data, and are you making the best use of it?
The first thing to realise is that there are several different forms of data.
Descriptive data, known as past (or historic) data is the self-generated data each company can access by default. This is the data related to marketing campaigns, sales reports, completed projects, and other internal information.
Predictive data, meanwhile, is the data that guides future business strategies. This information tells you how the customer base will evolve, how sales will increase and what marketing strategy will best serve your growth and sustainability targets.
Prescriptive data provides insights about various development scenarios. An analysis of this data helps to clarify which predictive data will work in a specific scenario.
The challenge we most often encounter when advising clients is a lack of foresight about the value and relevance of data at the point of collection. Without strategic, goal-orientated data collection, companies have to expend time and resources on organising data into a usable format. Accordingly, we advise clients on how to capture relevant data simply and cost-effectively.
There are a variety of metrics that can help give you a picture of your audience and potential sales.
Sales-related numbers include prospects, sales, conversion, and number of clients. The numbers in these four groups are interconnected. Look at these numbers as a flow, and try to establish cause and effect in your actions. A large number of prospects does not mean a large number of customers. A customer is the prospect that is ready to pay now and has no barrier in his journey.
Customer-related numbers include the customer acquisition cost and the lifetime value of the customer. Customer acquisition cost is the money you spend to onboard a new customer. Lifetime value of a customer is how much money the average customer will spend with your products over a period. If the lifetime value of a customer is higher than the customer acquisition cost, it means you are doing something right.
We also have a word of warning to impart regarding standalone numbers. Businesses should never make a decision by looking at standalone numbers in isolation. These figures are meaningless placed within a wider context. It may seem counterintuitive, but always remember: big does not mean important. Big numbers, unless compared to other numbers, always look big.
One way to contextualise big numbers is to divide them by a total, such as the total number of sales. When we divide an amount (for example, total number of people in a city) by another amount (such as the number of hospitals in that city), we get a rate. Amounts are easier to produce. Rates are more meaningful.
BRIDCON can help you make sense of the most important data you generate, and make use of the most impactful numbers of your business.