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Harnessing your digital data to drive financial decision making

Bivek Sharma | 21 July 2016 | 8 years ago

digital data
Digital data should now be the first thing you turn to for guidance on financial decisions
Big data is often a nebulous concept, but these five concrete examples show that micro business owners can use the records at their fingertips to make intelligent decisions.

Use your time more wisely on Facebook

Research carried out by Deal with the Media in 2015 revealed that 60 per cent of small business owners have no evidence that their social media strategy is working despite spending ten hours a week on trying to get their name out there.

Even without additional data analysis, you can decide whether to invest in promoting a post by looking at how much engagement it has got organically. And if something you put on Facebook does get lots of likes and shares, it’s a sign that it could be worth paying to promote it elsewhere too.

Reduce the 4, 000 you spend on admin each year

Given that the average small business owner spends 28 hours each week (or 4, 000 a year) battling red tape, recording exactly how much time you spend on admin tasks can provide a valuable source of information when it comes to deciding what to outsource.

There are apps out there designed to make calculating your digital time use easy and small business accounting can be outsourced for a lot less than you think.

Check the message is getting through

Email is the most popular SME marketing channel, with 82 per cent of small firm owners using it to drive new business, according to Royal Mail MarketReach. But the same study revealed that owners investing in content and data for their email mailing lists were unsure about how to measure return on investment.

If you’re not doing so already, measure open rates and click-through rates, and see which content writers or sets of bought data drive the most traffic to your site. For online sellers, identifying which types of communications not only drive customers to your site but result in a purchase means that you can spend more money on the marketing efforts which have a tenable impact on your bottom line.

Pick your battles

Trawling social media to find out what people are saying is considered key for big global brands seeking to remain top of their game, but it isnt just for Nike and Coca-Cola. There are hundreds of platforms which will allow you to monitor and analyse what people are saying about your products and services.

If feedback about a particular line is positive, consider producing more, or developing another, similar, product or service. On the other hand, if customers are complaining about something, use the data to justify investment in training to improve a customer service issue or product development to improve a physical offering.

Understand where customers are coming from

One of the most difficult and expensive stages of small business growth comes when you’re taking baby steps towards becoming an exporter and for many owners, the decision about which markets to target is fraught with difficulty. But data can really come into its own when you’re looking at new markets. Many small business owners are surprised to discover how much of their site’s traffic comes from regions they are not actively pursuing, whether that’s a different city in the UK or a foreign country.

If your small business makes money by selling something which can’t be exported, like services or perishable food, then a high proportion of foreign traffic could be a sign that some of your digital budget is being misdirected, whether through keywords which are not relevant to a local audience or adverts which don’t make it clear which area your company serves.

As Ive explained, there are an abundance of ways you can differentiate your business from that of competitors. From making your social media marketing more tailored to leveraging helpful apps, digital data should now be the first thing you turn to for guidance on financial decisions.

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