The short answer is Yes. Heck Yes. At some point during an e-commerce company’s growth, teams begin to organically form, and team members begin asking “why” and “how many” questions. This often happens when new customers are being acquired, and it’s not easily clear where they came from. You’re no longer measuring marketing ROI by the revenue that came in during the campaign only. Now you’re looking at customer lifetime revenue as the “return” part of the equation.
Up until this point, Google Analytics and Excel are the primary tools used to get visibility into the business. Excel, for obvious reasons like the lack of dynamic reporting, scalability and easy sharing, soon becomes tedious to maintain. And Google Analytics becomes a black box i.e. it is no longer capable of answering the “why” questions.
Here are some persuasive reasons to invest in a BI tool. Yes, it may cost a bit more, but you’re no longer the same company you were yesterday.
Data Driven Culture
When the organization has morphed from one big team where everyone is doing everything to 3-4 teams with loosely defined responsibilities, each team member automatically becomes an owner of at least one metric. And each team member should be able to keep track of that metric easily. This includes the Customer Success Teams - they should be able to keep track of metrics like Churn and Support Satisfaction. They should be able to correlate their functions to the top line of their teams and their companies.
Single Source of Truth
At the data source level - when you have multiple data sources - transactional data, marketing, support, sales, engineering - connecting them together unlocks a whole new world of analytics for your business. You can now identify whether/how a customer’s outreach to support affects their lifetime revenue or average order value. You can identify whether your engineering team’s process is aligned with your support team’s process so that bugs are being fixed swiftly.
At the metric level - Different teams at the organization now begin to track the same metric. For example, the executive team and the marketing team both measure “New Customers”. However, without having a BI tool where this metric’s definition is common for all teams could result in the teams defining it in different ways. For example, the marketing team would consider a new customer as anyone who has made a first order. However, the executive team might have a stricter view of this metric. They may consider only a repeat purchaser to be a new customer because that’s what they consider important. While both perspectives may be right, it is important that both teams use the same definition so that they are working towards the same goal. In this above case, the marketing team is not thinking of repeat purchases when acquiring customers even though that is the expectation of the executive team.
All this is to say that a BI tool, where everyone has access to their team’s analytics, results in flexibility in operations. A BI tool means that new questions can be asked of he business every single day. These questions engender more questions, which finally uncover the answer to the “why”.
Have questions about the business intelligence and analytics at your company? Feel free to comment below, or reach out here.