Business needs to collect and analyse data. Without it, no business cannot gain a competitive advantage. However, the manual process of gathering and then interpreting information is time-consuming and error-prone, which is why it is wiser to use a tool to perform the process automatically. The best and most popular solution is, without a doubt, business intelligence.
Business Intelligence (BI) is a set of tools that are gathered in one software solution. Their task is to collect data from various sources in your company, analyse it with the schemes, compare it to other performances and in the end create a report based on big data analysis, as well as a number of different types of vital information. Comprehensive reports can be translated into insightful information. This data allows companies to make safer, data-driven decisions, in addition to predicting and planning the next steps.
Business Intelligence is a compelling solution and a powerful ally in the world of rapidly changing conditions on the market. E-commerce is one of the industries in which using BI knowledge can be highly beneficial.
Some of the indicators examined by BI are more important in the world of e-commerce, for example:
1. Sales report – with information on sales, returns, taxes, sales analysis, shipping, refunds, discount coupons, promotional offerings, credit card collections etc.
2. Inventory reports – items sold, available items, quantities, new items, reorders, returns,
3. Trend analysis – analysis of customers’ changing preferences and behaviours on the market
4. Top performers – find out the most profitable projects, marketing campaigns, customers, segments, and sales channels
5. Marketing reports – the number of products in the carts, abandoned in the carts, search terms, response to the newsletter.
Of course, there are more, but every business is different and how the Business Intelligence tool looks are highly dependable on the performance and business plan of the particular company.
1. Increase sales
According to the study made by Nucleus Research, $10.66 was made for every dollar that a company spent on business Intelligence. The ROI (Return of Investment) in this case is more than 1000%. These numbers are enormous. What’s more, Business Intelligence helps you to reduce costs and implement more efficient processes based on big-data and reports. Higher sales due to higher knowledge about the customers and market are crucial. Business Intelligence can also save you and your employees’ time and resources.
2. Improve decision making
Your chance of success significantly rises when making decisions is supported by data. You can stop trusting your guts and start making data-driven decisions. The main task of BI is to help your company make smarter decisions quicker. Analysis of prices and schemes, historical marketing information and dashboards with revenues and sales are all beneficial features. Data is worth a lot and you can have it gathered, analysed and presented in a clear way using your BI tool. Thanks to BI you can quickly evaluate your actions, analyse reports, and prepare for positive changes.
3. Marketing suggestions
With BI tools, you can easily assess the effectiveness of your marketing efforts. It lets you see what products are selling and to whom. Based on this information, you decide which products are best to promote to particular markets. Business Intelligence can also show you what marketing campaigns and advertisements worked the best. Thus in your future work, you can focus on the most effective way to promote your products. Also, equally important are the behaviours and buying habits of your customers. Remember to analyse these and act accordingly.
4. Retention of customers
Gaining new customers is almost seven times more expensive than retaining a current customer. Business intelligence can give you insight into why your existing customers are leaving, and others keep buying from your company. You can collect data such as late shipments, returns and customer complaints and analyse it using your BI software in order to improve customer satisfaction. It should be crucial for you to create a customer-friendly business and keep your customers close. Thanks to that you can reduce the costs of gaining new customers and keep your current ones at a high level of satisfaction.
5. Make data-driven decisions
Performance scoreboards can provide measurement on the extent the objectives of the business were achieved. They also highlight the areas requiring immediate action and monitoring. Further analysis of scoreboards and dashboards allows managers to follow the data and identify both the customer groups as well as the products that meet the expectations or are lagging behind these expectations. With all that information, it is significantly easier to make the right decisions.
To sum up
Business Intelligence is a highly beneficial tool for almost every business, but it needs to be well designed and tailored for the company to be the most efficient. E-commerce businesses can gain a lot from being guided by data. They should seriously consider acquiring this powerful solution to gain new customers and stay ahead of the competition.