Importance of Analytics

For a long time companies have been using data, trying to make better decisions.

Analytics is a new buzzword to apply that process.

• Analytics help companies to improvise their decision-making power in any situation to meet their objectives.
  
  
  • Let's take couple of examples to understand how data analytics is important to make decision.
    
    
• You might be an administrator, professor or K3 teacher but now your objective is to make students ready from their existing grades to college grads. So how can you use data to improve that?

Let's pick some facts and figures and try to understand their problems and how analytics can be helpful for them.

Commercial Facts and Figures

• Walmart (Retail Industry)
  
  • Over 1 million transactions an hour
  • 9000 stores across the world
  • 10,000 to 1,00,000 Stock Keeping Unit (SKUs) per store

Analysis: If Walmart must get a simple statistic of “the average dollar spent by a customer” for his store, he must check 4 billion transactions to get the figures.

• Tesco (Retail Industry)
  
  • 1800 stores
  • 35 million clubcard customers
  • Over 1 billion items home delivered annually

• Airtel (Telecom Industry)
  
  • 8 Billion calls everyday
  • Hundred of different plans

Analysis: To determine the average duration of a call made within your network, you need to scan 8 billion calls of data (for just one day).

• Amazon (E-Retailer)
• Flipkart (E-Retailer)
• VISA (Finance)
  
  • Over 100 Million transactions a day

• FICO (Finance - Fraud Detection Agency/Service)
  
  • Protect over 2 billion accounts worldwide

... What if you must generate some insight from this huge amount of data, you need Analysis of the data.

Common Issues/challenges

Financial institutions (for example Credit Card Companies):

How Analytics can solve the following common problems:

• Whom should the company offer credit cards?
• How to decide the credit limit for each customer?
• How to identify records?
• How to predict bankruptcy?

Retailers

• How do I stock the products to maximize the profits?
• How do I make marketing efficient to make a big reach towards the customer?
• How do I price new and existing products in my store?
• How to design promotion strategies to maximize customer benefits?

FMCG Companies

• How do I price a product?
• How to determine if an ad caimpaign is beneficial for the company
• ROI on marketing Budget?

Telecom

• How to manage/provide credit limit to postpaid connections
• How to sell more value add services?

So the preceding discussed common problems involved with the efficient management using proper Analytics.

I hope this article helped you to understand the Importance of Analytics.