There are few topics in the world of business management and growth that see near-unanimous agreement. But when it comes to the power of data, a stunning 99 percent of businesses agree that data-driven decision-making provides them with a competitive advantage, according to a 2019 report from information services company Experian.
That's an impressive testament to the power of data.
But that power is limited when it's not accompanied by strong data visualization. In fact, 89 percent of the companies surveyed said that managing their data was a challenge. In large part, that's because it's hard to gain any real value from looking at a spreadsheet chock-full of numbers. And many people feel uncomfortable creating accurate data viz.
One in three of those surveyed by Experian said their company lacked the skills to manipulate the data in a way that would help them gain meaningful insights from it. So let's take a look at some ways data visualization can help.
1. Recognize patterns and trends.
As I've already said, a spreadsheet of raw data just doesn't cut it if you're looking for real insights. That's where graphs, charts, maps, and other types of data viz can help.
When your data is visualized accurately and thoughtfully, you'll no doubt begin to notice trends and patterns instantly. Maybe your site traffic tends to decrease at the beginning of every month. Or perhaps you notice a correlation between sales numbers and geography. Whatever the case may be, a visual representation of the numbers makes patterns immediately apparent.
Meanwhile, you may think you're able to glean insights from a spreadsheet, but it's just as likely that you're interpreting the numbers inaccurately. That's because it's simply impossible for most people to hold that many data points in their mind simultaneously. So without data visualization, there's an added danger of drawing false conclusions.
2. Ask the right questions.
Once you've noticed these patterns, you're better equipped to ask the kinds of questions that will make a real difference for the future of your business. What's causing that drop in site traffic? It could be that there's a fundamental characteristic of your industry or your customer base that you're not taking into account. And if you're performing better in some parts of the country than others, why is that? Can you tailor your marketing messaging to capitalize on those differences?
These are the very questions that the most adept business leaders ask on a daily basis. But they wouldn't even know what questions to ask without powerful data visualization to point them in the right direction.
3. Make better plans for the future.
Now that you're asking the right questions, you're empowered to make data-driven decisions about the growth and direction of your business. You may discover new opportunities, or learn that you're spending too much time on segments that just aren't helping your bottom line. The success of a business is predicated upon such considerations.
4. Improve the customer experience.
The Experian report found that an impressive 98 percent of those surveyed agreed that data helps them better the customer experience.
It's easy to see how that could be the case. Data about customer demand and behavior -- including what they look for in a product like yours, and how they use your product when they buy it -- can be incredibly powerful. It helps you recognize where you're succeeding and where you can do more. It allows you to give your past and future customers exactly what they're looking for. And this won't just keep them coming back -- it will drive them to tell others about what your business has done for them!
5. Earn your audience's trust.
Sometimes, you'll want to share the data you collect outside your organization. Perhaps you're proud of your customer satisfaction rate and you'd like to share it. Or maybe you've conducted a survey about the impact of your product, service, or industry and want to publish those results.
Sharing data that supports your claims makes them all the more powerful. And in the process, it builds trust with customers and potential customers. That's because it makes your company look more transparent and proves that your claims are evidence-based.
Trust, in turn, helps you build customer loyalty and cultivate long-term relationships with your clients. The benefits of data visualization are hard to overstate. Now, it's time to ask yourself: how can your business use data to build its future?