Yet historically many have failed to recognise how data analysis can deliver a strategic advantage by unlocking the knowledge found within existing customer databases.
When you consider the amount of time, effort and budget already employed in creating a database, investment is wasted if this powerful resource is not put to good use. Every customer database potentially holds a wealth of information on a business's successes and even its failures.
It can tell you who your customers are, where they are located, what they buy and when they do so. Even with the promise of such valuable insight, the number of companies that have used the intelligence stored within their databases has been shockingly low.
The main barriers have arguably been cost and the complexity of analytical tools. But thankfully the analysis market today is radically different from five years ago, making it far more accessible to businesses whatever their available budget or level of understanding.
A business taking its first steps into the world of data analysis needs to firstly decide on the objective of the analysis. What are they hoping to achieve? This may be developing an up-selling programme by segmenting and targeting specific customer groups with relevant offers, or modelling existing customers to pinpoint the most appropriate external data needed to drive an acquisition campaign. Determining the objective, or likely objective, can be instrumental in identifying what level of analysis will be required.
Many organisations do already have systems in place, but data analysis has largely been confined to the realm of the IT department. Software purchases are often made by IT decision makers rather than marketers, resulting in products which are driven by IT skills, priorities and timeframes, rather than those of the marketing or sales division.
Thankfully, we are now seeing the launch of simpler and more user friendly online solutions developed with the marketer in mind. The first crucial difference is that most of these products have no software to install, which will limit objections from the IT department and make the whole process more manageable.
With an online tool, a marketer can simply log-in and carry out the analysis they require without having to use any in-house IT resources. The analysis provider holds the data on a secure server and all the processing power comes from this external source, so IT need never get involved!
Secondly, providers have realised that it is often the marketer and sales professional that require the insight locked within a database and not just skilled data analysts. It is these individuals who are at the frontline carrying out campaigns and that are given increasingly tough targets to meet.
The newer applications have been designed with software that is much easier to navigate and use, removing the need for extensive training. And finally, and perhaps most importantly, the price of analysis is coming down. The flexibility of online solutions and monthly subscriptions means both the novice and the expert can access a tailored application.
With economic turmoil on the horizon, sales and marketing professionals are under even greater pressure to deliver. For many, the ability to access the insight locked in their existing customer databases, through the use of cost-effective and easy to use analytics tools, could be the lifeboat they need to weather the storm.
Kirsty McKinney is brand manager at Market Location.