We generate trillions of bytes of data every day, from health and location trackers to social media posts, video streams, and electronic purchases.
More than 90 per cent of the data ever created appeared in the last two years.
Simultaneously, the ability to gain actionable insights from data is getting better, and the barriers to those insights aren’t as high as you might think.
“The sophisticated analytical tools available to us are making the interpretation of data far quicker and easier,” says Lindy Newton, Executive Director Client Analytics, Institutional Banking & Markets, Commonwealth Bank.
“Processing times are getting quicker, costs of storage are coming down. Things are getting better all the time.”
This trend is set to continue, and it presents a major opportunity for companies to better understand their business environment.
Social media can give you a glimpse of your customers’ thoughts. Wearable devices like Fitbits can help you get the best out of your employees, and there are a myriad of opportunities in studying your own finance and logistics.
With all that data floating around, it can be easy to lose your objective. The whole operation needs to be structured to produce an actionable insight.
“You can spend a lot of time and find out something that is quite interesting. But unless it is actionable, you really haven’t created anything valuable,” says Newton.
“A fact could be: I’m a shop and 90 per cent of my customers are male. But if I’m actually trying to sell womenswear, the action I might take is that I need to somehow engage with some females out there.”
And you don’t have to be a data geek to produce actionable insights, nor do you need huge amounts of data to find something useful.
Newton talks of useful inferences that shop owners can make from analysing their receipts for commonalities and trends. Inferring peak sales times from receipts, or what products are bought when, are both useful insights.
Even better, these small datasets can be combined with bigger, public datasets to unearth even more connections – such as the weather’s impact on your sales of ice cream.
“In our recent CommBank Offers app trial with Westfield Hornsby for instance, we presented offers to customers based on their in-app usage and spending habits,” Newton said.
“As our thinking evolves in this space, we hope to use aggregate market data to help merchants refine marketing campaigns. This way they can communicate to the right customers, in the right place, at the right time.”
You may need new skill-sets to process and mine bigger datasets, to tease out more complex and nuanced insights. But new platforms are democratising data analysis, and coding and IT skills can be learned the same way people have developed the skills to manage other innovations in the digital era.
The real key, says Newton, is the business acumen to know what questions need to be addressed.
“You need people who understand what is driving the business, or what can be pain points in the business,” she says.
“People who can identify the problem, how data can lend itself to the problem – and once you have played with the data – how you can generate an actionable conclusion from what you learn.”
There are diamonds in the mountain of data. You just need to start digging and know how to recognise them.
This post is part of the Innovation Insights series, sponsored by CommBank. At CommBank we believe innovation starts by asking questions. Discover new ways to keep your business moving. Start today at commbank.com.au/canbusiness.
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