It would be odd to read a business-related article, website, or magazine today without reading the word ‘data.’ Talk of data analytics and Big Data has exploded in the last few years, with almost every organization and industry talking about it. (Biztechmagazine.com)
According to market research firm IDC, revenue from data and business analytics will reach at least $189 billion in 2020, 13% higher than income from 2018. By 2022, it is anticipated that the number will exceed $247 billion. (IDC.com)
To keep pace with the greater need for data analytics, more universities are adding degree programs. There are at least 600 higher education programs that teach data science as a major, including certificate programs and bachelor’s and master’s degree programs. As more business and data analytics jobs are being created daily, companies that have not dedicated resources to analytics will find themselves in the rearview mirror of companies that have.
Revenue Booms When Businesses Use Data
Results indicate that data analytics is not just a buzzword. It is adding value to companies in every industry. The McKinsey Global Institute reports that companies driven by data are 23 times more likely to get more customers. (McKinsey.com). Once they have acquired those customers, they are six times more likely to keep them.
Those added customers from using data analytics are bringing in more cash. Organizations that mine their data are 19 times more likely to make a profit than those that do not, according to the same report. Entrepreneur also reports that businesses using data lower their costs by 10%. (Entrepreneur.com)
Executives also are taking note. Forbes reports that 79% of enterprise executives say that if their company does not embrace data, they will go out of business. Also, 83% of those surveyed said they are using data analytics to gain an edge over competitors.
How Companies Can Take Advantage of Big Data
Although the benefits of using data science are clear, some companies are still struggling to make the best use of it. Only 12% of the data that is available to companies is analyzed, and 95% of businesses say they need to do better at managing unstructured data. Many companies are turning to various analytical tools to close the gap, and 64% of company leaders say that self-service business intelligence gives them an edge on the competition.
The good news for companies still trying to get going in data analytics is that the barrier to entry is lower as the popularity of using data for business has grown. Companies that want to optimize their data can find affordable services that puts all of it in one place. Products such as IBM Watson and Microsoft Power BI help to streamline the data management process as companies are seeking business insights in the numbers.
Data Analytics Offers Real-Time Analysis
Many companies that analyze big data sets are analyzing data that is a snapshot in time. That means the data was collected and collated into a large database before it was put into the data analytics software. But there is a growing number of scenarios where the data being analyzed is generated and recorded in real time. This allows some companies to make decisions and perform decision analysis using the latest data available. (AZbigmedia.com)
For instance, the insurance and banking sectors are now using data analytics as a way to pump out more accurate risk assessments, rather than just looking at a customer’s financial history. These companies can evaluate more variables and make a better-informed business decision.
On a similar note, retail companies can use data to get better insights about emerging trends and how they can get ahead of what is coming. It is always difficult to figure out what The Next Big Thing will be, but by reviewing variables beyond those that most people understand, data algorithms can make predictions about the future that people cannot.
Big Data Is Driving Growth
One of the reasons that today’s big data industry is so vital to the tech sector is because it is a huge source of new technology jobs. As possible applications of data analytics are becoming clear, and access to software and hardware to take advantage of it becomes more available, businesses who once could never have dreamed of using data are now looking to bring data analytics scientists on staff.
Data analytics is extremely important for the entire tech industry. Within the technology sector across the world, data analytics is the foundation of the newest advances in machine learning and autonomous vehicles. Those self-driving vehicles being piloted by Google and Uber need advanced machine learning algorithms to look at a camera feed and identify road signs, pedestrians, obstacles, and more.
Massive Amounts of Data Will Need to Be Analyzed Soon
It is estimated by some sources there will be more than 150 trillion gigabytes of data that need analysis by 2025. (Forbes.com). Forbes also noted that an annual survey of IT professionals found that the number of respondents who are using predictive analytics grew to 60% from 40% the year before. Meanwhile, content analytics usage has grom to 54% from 43% the year before.
Experts at Forbes believe this exponential rate at which firms are collecting data is boosting the need for easy visualization and the ability to analyze and take action on large sets of data. Therefore, demand for new data analytic tools will grow, and this may increase valuations for companies that produce them.
There also will be a greater focus on being able to use that data to increase efficiency and profits. Platforms designed to visualize vast quantities of data, such as Tableau, will be important for revealing business patterns and insights. If a company has limited resources, there still is help available with free options, such as Google Analytics.
As the numbers make clear, any business that wants to streamline efficiency and optimize resources needs to be using data analytics now. And with more affordable services available, there is no better time to start than today.