Business intelligence (BI) is an innovative concept that has been transformed and modeled by technology in the past couple of decades as powerful software has been developed to process and analyze data quicker than ever.
For both physical and online businesses, business intelligence can unlock the kind of growth that can propel a company to a whole new level.
In the specific case of online stores, innovative applications like the Beprofit app are empowering store owners by giving them access to insightful information about the profitability of their ventures and this is only one example of the scope and reach of BI for online businesses.
In this article, we dig deeper into this concept and into the positive impact that it could have once implemented to grow an online store.
How does BI work and what is its goal?
Business intelligence is a concept used to define a group of strategies and methodologies employed to analyze all the data that flows through a business along with a selected group of external indicators that can allow the management team to make more informed decisions about the business.
All kinds of data can be processed and analyzed by today’s advanced BI software going from sales to human resources data.
The goal of BI is to help managers in making objective decisions that are primarily based on facts.
Take for example a sales manager who needs to know how many representatives he should hire for the different geographic areas covered by the company. The best BI software would use historical data from the company’s sales to analyze things like the number of clients per region, average sales volume per client, and other similar variables to help the manager in estimating what the adequate number of reps should be.
Meanwhile, for online businesses specifically, BI can be taken to a whole new level as tons of data is collected from every customer and even visitor that interacts with the company’s online store.
This data can provide helpful and insightful information about the patterns, preferences, and needs that have been demonstrated by different groups of consumers.
As a result, the user experience can be customized to a point that the person who visits the website feels that the company knows exactly what he/she is looking for.
Additionally, data obtained from the company’s sales can be used to determine the most profitable segments of the business, the buyer persona that purchases the different goods offered, and other similar complex analytics.
How can it be applied at online stores?
Innovative applications such as Beprofit have developed software that can be easily integrated with the best e-commerce platforms out there such as Shopify and Wix to facilitate the process of tracking the business’s profitability over time, among other things.
The data required to power these applications is obtained from the store’s database and the software will do all the heavy lifting to produce insightful reports about different aspects of the business.
This is a summary of the kind of insightful information that could be obtained by integrating BI software into an online store:
- Which products to offer based on their turnover rates, profit margins, and sales volumes.
- Sizes, colors, models, and other characteristics have experienced the highest demand in the past.
- Seasonal trends.
- Which products have the highest return rate?
Another benefit of BI software is that companies can save money on unnecessary personnel that would have to be otherwise hired to process the huge amount of data that typically flows through an e-commerce management system.
The disadvantage of performing this kind of analysis manually is that relevant information could be left out or ignored in the process.
With this in mind, using BI software in an online store can only yield positive results, and the cost of these applications compared to that of hiring specific personnel to perform similar tasks is negligible.
Bottom line
Have you been struggling to determine what needs to be adjusted within your online store to reach the next level?
Business intelligence software might be the answer to step out of the stalemate and improve your business’s results by understanding your customers better and identifying key trends that could be emerging.
Interesting Related Article: “The Top Business Intelligence Platforms Looking To Disrupt their Industries“