In times gone by, marketing would have entailed representing a product and encouraging customers and prospects to purchase that product by shouting ‘buy here! Buy now!’, or something of the sort. Of course, we’re talking decades ago, centuries, or even millennia. Despite the overall objectives remaining the same, the way that businesses carry out their marketing today is much more advanced.
There are many different reasons for these changes in business best practices. But one key explanation is data.
Data enables organisations to look internally and analyse each and every aspect - its customers, what it’s doing right, where it could improve, and its progression over time. But let’s get down to the brass tacks - how do businesses attain, organise and practically utilise this data? The answer is through data warehousing and business intelligence.
What is a data warehouse?
A data warehouse is a central repository of integrated data. Data warehouses store current and historical data, gathered from an organisation’s diverse source systems, and consolidate it all in one place. They are specifically structured to facilitate querying and analysis. Data warehouses often form the basis of a business intelligence platform. Though they are different, data warehouses and business intelligence work in tandem.
A standard data warehouse will include a relational database and an ETL (Extraction, Transformation, Loading) solution that enables BI capabilities.
A relational database is a type of database that stores and provides access to data in relation to other data. The information is organised into tables that can be linked based on data common to each. This makes it easier for organisations and/or analysts to better understand relationships amongst available customer data and gain new insights.
An ETL solution is a common way that organisations combine data from multiple, disparate sources into a data warehouse where it is then used for business intelligence.
- Extraction: data is retrieved from one or more sources (online, on-premises, legacy, SaaS, etc.) after this, data is put into a staging area.
- Transformation: data is taken, cleaned, and put into a common format. Cleaning typically involves taking out duplicate, incomplete or inaccurate data.
- Loading: inserting the formatted data into the target database, data store, data warehouse or data lake.
What is business intelligence?
Business intelligence (BI) is a set of technology-driven processes that take data and transform it into actionable insights that inform and influence an organisation’s strategic and tactical business decisions. BI seeks to address the known unknowns of a business. To empower companies, and the decision-makers within, to discover things about their business that they had often never even considered.
Research shows that 74% of top performers find that siloed or fragmented data is one of the most challenging aspects of business intelligence. This is where data warehousing and business intelligence combine to make the perfect team. The purpose of a data warehouse is to perform queries and analysis of large amounts of historical data. Data that resides in a warehouse is defined as being in-use, as it has been processed for a particular reason and into a specific format, namely business intelligence.
Some business intelligence programs pull information directly from source applications and others require the use of a data storage system to aggregate diverse data sets. Business intelligence typically combines disparate data sources via a data warehouse, which acts as a central area where BI applications can query and analyse. Analytics and reporting tools can technically function without data warehousing, however, doing so can be limiting; data stored within different systems often exist in different formats, making it harder to draw connections and identify patterns. Data warehouses cleanse and standardise data making it more consistent, accurate and of better quality. This, in turn, streamlines business intelligence processes.
Business intelligence for marketing
Business intelligence software takes data analytics beyond the basic realms of organisational analysis. Business intelligence expert, Cindi Howson, differentiates two different types of BI: traditional (or classic) business intelligence and modern business intelligence.
- Traditional BI: IT professionals use in-house transactional data to generate reports.
- Modern BI: business users interact with agile, intuitive systems to analyse data more quickly.
For certain types of reporting that require rigid accuracy, like financial reporting, organisations will opt for traditional BI. However, for marketers who operate in a fast-paced environment, modern business intelligence is preferred as it allows users to gain insight into dynamics, behaviours and information that are rapidly changing, such as marketing events or campaign performance.
When it comes to marketers utilising business intelligence, the common BI features we think of are dashboards and reports.
Dashboards are hosted software applications that automatically pull together available information into charts and graphs that give a view of the immediate state of the company. They allow people to examine information, understand trends and derive insights into current aspects of an organisation e.g. where are sales prospects sitting in the pipeline right now? How many marketing qualified leads have we gained this month?
They’re single-page visualisations that include the likes of colourful graphs and charts, making it easy for decision-makers to analyse the aspect of the company or campaign that they’re focusing on. Dashboards can be personalised and offer consolidated information in real-time (seeing what’s happening now). They offer easy-to-understand KPIs, summaries of information that enable agile decision-making and eliminate guesswork. Additionally, dashboards are a lot more versatile than reports in that they can be used and understood by a lot more people within a company.
Source: NewVantage Partners
Reports, on the other hand, are multi-page accounts. They are typically in document formats and are used to gather and present large sets of detailed intelligence. Reports are used more by business analysts as opposed to multiple departments within a company.
Reports are a major source of data and can be super useful for business insights, however, the data that they supply isn’t updated in real-time and generally represents a single aspect of a company and can be quite complicated and extensive, therefore more difficult to understand. Whereas a dashboard has the ability to offer a number of different metrics from different departments, such as Sales, Marketing, HR, Manufacturing and so on. Reports usually need to be ‘run’, which can take time to create and then export. That being said, they are a favourable choice if you need to deep dive into the nitty-gritty details.
Whilst all aspects of business intelligence are beneficial for actionable business insights, for marketers, dashboards are undoubtedly the most advantageous business intelligence feature. Business intelligence dashboards help marketers to better understand and also visualise their actions in terms of the business and, as a result, improve the decision-making process based on real insights.
But what do marketers actually gain from utilising business intelligence?
Business intelligence insights: actionable analytics
BI features aren’t simply there for marketers to gaze at - the enticing streams of data and the highly visual dashboards - the analytics that business intelligence offers enables marketers, and organisations in general, to optimise business output and strengthen their company.
Marketers that activate business intelligence insights retrieve answers to common important questions like: are my campaigns driving conversions? Are my KPIs on-target, below-target, above-target or remaining static? Are the company’s social media profiles growing and being interacted with?
As well as answers to those ever-present questions, BI offers marketers a gateway to achieve the following opportunities:
- Better targeting: sending the right message, at the right time and to the right person is a surefire way to see positive results. BI gives marketers the insight to better target customers based on real data. Because failing to target the most relevant customers and prospects means your company is missing a trick - and your competitors will pick up those profitable audiences that you fail to target.
- Campaign optimisation: analytics dashboards show marketers which campaigns (when, where, why, etc.) are performing best and driving the most leads. BI tools allow you to track and analyse campaign performance in real-time and compare these against historical data. This enables you to make changes or improvements based on real historical patterns.
- Improved customer experience (CX): companies globally compete to deliver the best CX. BI provides companies with the necessary tools to better understand customers and prospects and understand their wants, needs, behaviours and pain points - and cater to them accordingly.
- Streamlined strategies: BI enables companies to gain a holistic view of their activities and, as a result, benchmark results against competitors and/or goals, and identify strengths, weaknesses, opportunities and threats to the business. Having the accurate data and speedy reporting that warehoused data and BI facilitates means you’re able to create marketing strategies that are authentic and highly targeted.
- Optimised ROI (return on investment): companies can experience a major improvement in their ROI when BI is utilised to meet the above points. When audiences are well-targeted, campaigns are optimised, CX is improved, and strategies are streamlined, companies can experience sustained and steady growth.
But it’s not just marketing. Other departments can utilise business intelligence tools to gain insight. Take sales, for example. Business development teams need to know where their prospects are in the sales pipeline today. The knowledge that BI leverages helps to optimise customer acquisition efforts and eases prospects down the sales funnel.
Business intelligence can enable cross-departmental collaboration by enabling different teams to access an organisation’s reports and dashboards.
With cross-departmental access to dashboards, sales, marketing and, often, other departments have the ability to monitor business activity and clearly see, for example, where, when and why customers might be dropping off in the customer journey, where marketing qualified leads are being driven, and so on.
Practising business intelligence without a data warehouse can have its downfalls. As we have discussed, data warehouses organise and standardise data making it easier for BI software to analyse and therefore more effective for organisations to utilise.
Data warehousing and BI tools eliminate individual perspectives which, in turn, enhances lead generation, streamlines productivity and empowers businesses to make decisions that are strategically relevant - providing an overall healthier organisation.
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