Today, if you want to compete with the best in the industry, you must have a holistic and accurate view of events taking place in your sector. You must be able to sift through all the data accessible to you. And the only way you can do that is by using a robust and intelligent analytics solution.
The past decade has seen technology evolve constantly. As a result, all the essential tools for data analysts have also evolved notably. The section below will introduce you to the three kinds of data analytics in use currently. You will also get to know about how AI or artificial intelligence has become one of the biggest pillars as far as data processing is concerned.
About Descriptive Analytics
As expected, descriptive analytics offers descriptions of events of the past. The process of descriptive analytics involves acquiring raw historical data and using the data to create an accurate and easy-to-understand view of patterns and behaviors of the past. Here, the term “historical data” may refer to facts and figures from five years ago or even from just five minutes ago.
How Do Descriptive Analytics Work?
Having information about past events helps people to predict the future more accurately. Businesses often use descriptive analytics to comprehend the following:
- Buying patterns of customers
- Patterns of supply chains
- Overall business performance including sales and more
About Predictive Analytics
Predictive analytics provide us with the ability to predict or forecast events of the future accurately. Understanding what the future may hold for them helps companies to remain prepared based on various probabilities.
Predictive analytics involves acquiring historical data from different silos like CRM, POS, and ERP. The process also involves combining the acquired data to form a single version of the truth.
How Do Predictive Analytics Work?
The truth obtained using predictive analytics allows businesses to forecast demands in the supply chain, identify sales trends, purchase habits of potential customers, etc. Experts do these predictions based on a range of variables obtained using predictive analytics.
About Prescriptive Analytics
Prescriptive analytics is the most recent addition to the list of data analytics. This solution makes the previous iterations even more effective by predicting possible outcomes. What’s more, prescriptive analytics also prescribe the best possible solutions to problems that companies may face in the future. Additionally, you can use it even to find out the reason behind the predictions.
How Do Prescriptive Analytics Work?
Prescriptive analytics presents the best possible answers to the question: How should we proceed? Despite being a fresh addition to the list of data analytics, many top retail companies have started to use it successfully for optimizing the customer experience, inventory, purchasing, and production. This is allowing them to ensure that the interested parties are getting the right products delivered on time.
Prescriptive analytics plays a vital role even in the stock market. In this case, it works by recommending the right time to buy a stock or sell it or identifying the right stock for investment. In short, you can use prescriptive analytics to optimize your stock market profit.
If you want data analytics to improve your business performance, you must use the three options discussed above together.
The Inclusion of Artificial Intelligence
Experts believe that AI will make analytics even more powerful. Earlier, the term “analytics” referred primarily to descriptive analytics. With a notable increase in data generation, businesses got access to predictive analytics. Artificial intelligence will make data analytics tools even more sophisticated.
Soon, the world might see AI play a crucial role in enhancing the efficacy and accuracy of prescriptive analytics. Sales-based companies can use AI to obtain recommendations that can help sales representatives to generate more leads. Prescriptive analytics will identify buying patterns of the target audience and help businesses to spot products to be bundled. This will eventually result in bigger orders and decrease delivery expenses.
Companies have already started to use predictive ordering to ship products that their customers will need before they (the customers) place any order. This method is particularly useful for companies selling relatively low-cost products like toothbrushes, razors, etc.
Do you want to make your company’s data analytics more powerful? If yes, seek assistance from a trusted software vendor to ensure that the tools you are using make good use of artificial intelligence.