Analytics plus Data equals Magic
Every action of an individual produces data. Or so it seems. Every phone call. Every mobile recharge. Every credit card swipe. You get the drift. Every digital transaction creates data. Cars, refrigerators, fitness bands, house alarms and sprinklers – you name it and it is a connected device. And all these produce data. It has been said that companies collect about 75,000 data points about an individual.
It is every marketer’s dream to really know his customer – then marketing to him or engaging with him becomes incredibly easy. All this data is like gold in the hands of the right marketer. If he knew how to sift all the piles of data to find the nuggets that he needs, then he can derive all kinds of insights from it and base his strategy of engaging with him, on that.
Which is where Analytics comes in – with Analytics it is possible to discover patterns – meaningful patterns and make sense of all this data. We now have sophisticated tools that can sift through these mountains of raw data and find interesting insights. And this is done through some statistical modelling and some computer programming.
So when you get a mountain of data and throw some analytics at it, the result is sheer magic.
So what can happen?
Broadly speaking, you get three kinds of amazing insights.
Descriptive insights – These are all about giving you a description of things – they “describe”, or summarize all the raw data that is available and presents it in a form that us human beings can make sense of and understand. They pick up a moment and describe how things are at that time. So if you want to know or understand past behavior in order to understand future behavior, this is the tool you turn to. You can find out the total stock in an inventory, for instance. Or the sales figures over time.
Predictive is all about what will happen, as the name suggests. It is about understanding the future. Based on the data that it has been fed, Predictive tools have the ability to predict what is likely to happen in the future, based on the past. Based on probabilities, predictive tools will go through all the data and find patterns in it and forecast future trends – maybe in customers’ purchasing patterns or in their ability to repay loans etc. A good example could be the prediction of how a certain year’s holiday sales might turn out.
Prescriptive – this kind of analytics is all about giving you good advice. Based on the data, and the description of the past along with an understanding of possible behavior in the future, Prescriptive analytics offers solutions. It recommends what course of action to take – gives you options for you to take. It uses a blend of business rules, algorithms, machine learning and computational modelling procedures on historical and transactional data, real-time data feeds, and big data to offer multiple solutions.
The combination of Analytics and data in the hands of the right people, asking the right questions and setting the right algorithms, can produce pure magic. A business can be transformed entirely – no longer is anyone fumbling in the dark. Now every decision is powered by data and strategy based on this data. All it needs is the right people with the right thinking to set all of this in motion.
Analytics + Data = pure Magic!: