6 Types of Data Your Business Can’t Afford to Ignore

With access to an infinite amount of data, it can be confusing to know what to track and what to leave behind. If you try to capture and measure everything, you’ll get lost in tedium. However, if you overlook important data, you might make the wrong decisions.

Here are the top 6 types of data that, when tracked, can have a significant impact on your business.

1. Predictive Analytics

Predictive analytics aims to forecast future events based on historical data and considers what is likely to happen. This is in contrast to prescriptive analytics, which goes beyond explanations and asks, “what’s next?”

This data is important because it helps you anticipate market changes and customer behavior based on historical trends. For example, an office supply store might notice that demand for certain supplies (like desks and laptops) is likely to spike because of an increase in remote work. 

With this insight, the business owner can adjust inventory, market to a more specific demographic, secure a steady supply, and implement strategic pricing.

Overall, predictive analytics provides business owners with actionable insights that help them make informed decisions about future events involving everything from the supply chain to customer behavior.

2. Customer Insights

Tracking data related to customers is crucial. For example, tracking purchase history allows you to send special offers only to people who have already purchased a specific product or service. The more you know your audience, the better you can target them with specific messages tailored to hit their pain points.

Other forms of helpful customer data include the average purchase amount, rate of successful upsells, bounce rates, abandoned cart rates, and all the various metrics you can extract through your email marketing application. 

The better you know your customers, the easier it is to strengthen loyalty and retention.

3. Inventory Levels

Tracking inventory regularly can provide granular insight into your business, like what’s selling, how quickly, and at what times. If you only track inventory monthly or every few months, you’ll miss buying trends that could potentially make you more profitable.

For example, one common mistake businesses make is lumping variations together under one SKU and/or not tracking what sells out first. For example, a business might sell two flavors of a particular soda, and by the end of the week, both flavors are sold out. The business owner thinks both flavors are selling equally well, so they’ll keep ordering the same amount, week after week.

What the business owner doesn’t know is that flavor one sells out the first day it’s stocked on the shelves. Then, as time goes on customers settle for the other flavor as a substitution, but it’s not what they really want. If the business owner were to stock more of the first flavor, people would buy a higher quantity. Instead, they settle for the second flavor and only buy one. This may seem trivial, but consistent stockouts can drive customers to competitors.

4. Paid advertising (PPC) Data

You’ll need access to performance data to refine your advertising strategies and increase ROI. While each advertising platform has its own native data stream, it’s important to combine all possible sources to get the bigger picture. 

For example, Facebook Ads will tell you how many clicks you’re getting, but compare that to the stats provided by your webhost to make sure it’s accurate.

5. Product Performance

When you know how each of your products are performing, you can make the right decisions regarding prices, restocks, and expansion. Knowing what your customers like, what’s working, and what doesn’t work is essential. For instance, everything from sales trends to customer reviews to negative feedback can help drive product improvements and innovation.

6. Regulatory Compliance

If you’re governed by industry regulations, it’s critical to monitor your industry for changes so you can stay on top of new laws and avoid the harsh consequences of a violation. Subscribe to industry publications that tend to announce changes, or reach out to an attorney to see if there’s a mailing list you can join for updates.

Let Data Drive Your Future

Tracking the right data is more than a task – it’s a commitment to making better, smarter business decisions. By analyzing key metrics, you can identify trends and address weaknesses before they become a major problem. 

You’ll get a clear picture of your business’ performance, and you’ll have time to adapt to market changes. At the end of the day, data isn’t just information. It’s your ticket to building a strong, successful business!