Would you take out your car for a drive in the middle of the night knowing your headlights are busted? Probably not. They are essential for visibility and navigating the road without putting your car and yourself at serious risk. Business intelligence provides guidance in much the same way.
In fact, the use of business intelligence software across many industries is becoming a standard practice. According to a 2018 business article published by CAGRValue.com, the international BI and analytics industry was worth $22.70 billion in 2018 and, by the end of 2026, will grow into a $55.48-billion market. The demand for powerful business intelligence platforms enabling the enhancement of business operations, optimization of business resources, and improvement of financial performance among other purposes will further drive the growth of BI and analytics software market.
As BI technology continues to progress, powerful and more advanced business intelligence tools will come into play, spurring massive adoption among businesses and across industries. The following sectors are established examples already reaping the operational benefits of business intelligence software.
1. e-Commerce Sector
The e-Commerce industry is among the biggest sectors that leverage business intelligence software. Large e-commerce businesses such as Amazon need to stay on top of their data and quickly make sense out of their information to optimize and improve their supply chain.
Amazon in specific has a colossal supply chain, which includes 11 different marketplaces that sell over 3 billion products. On top of that, they have to oversee other areas of their operations like manufacturing, shipping, storage, subscriptions, customer service, and other systems.
With its own business intelligence and analytics platform, Amazon Web Services, the company is able to collect data from various sources, analyze them using their own analytical algorithms, and visualize data to generate high-quality insights into all areas of their business.Using the intelligence they derived from their data, Amazon identifies the products that appeal to certain customer demographics, determines the most viable warehouses to store items, and creates custom shipping routes to expedite product delivery.
The result? Business intelligence software has helped Amazon increase their revenue by as much as 30% annually.
Even if your e-commerce business is not as large and complex, you can still use business intelligence to speed up delivery, optimize both storage and shipping processes to cut down on transportation and inventory expenses, and choose which products your business should focus on selling.
2. Retail and Hospitality Industries
As the e-commerce sector leverages business intelligence to discover and address pain points in their supply chains, players in the retail and hospitality industries use business intelligence to help them identify and target potential customers as well as improve their relationships with existing clients.
Combining information from CRMs, ERPs, and other systems, business intelligence platforms enable retail and help create a complete, crystal clear picture of their customers. Customer desires, motivations, triggers, and other insights all coalesce to help retail and hospitality companies engage, interact, attract, and convert people into loyal customers while growing their consumer base.
With definitive insights derived from business intelligence and advanced analytics, major retail brands like Costco not only improved their customer acquisition and retention but also boosted customer loyalty. Costco’s use of business intelligence to pinpoint issues with their customers’ purchases and immediately contact their consumers to rectify any error at their end is now a case study being studied all over the world:
- Lift 361 Case Study: How Companies Are Using Analytics to Win Over Customers
- Business Wire: Big Data Analytics in Retail Market Growth, Trends and Forecast 2019-2024
- Huffpost: A Sort of Creepy Reason to Love Costco
Famous Seattle-based coffee chain Starbucks leverages information gathered from all their transactions to predict customer behavior. Using predictive analytics, Starbucks was able to create and launch personalized promos for their customers. For example, a client who regularly orders a tall black coffee will likely appreciate a free order of the same coffee instead of the seasonal latte.
Aside from marketing and promotions, Starbucks’ use of business intelligence helps them with many aspects of their operations, including real estate development, pricing strategy, and product development, according to a 2018 Harvard Business School article.
Business intelligence software also aids in selecting other systems for bolstering performance and improving overall efficiency. For instance, a restaurant that struggles with their payroll can use insights from their BI software to help them go over a list of payroll companies and choose a software that suits their needs and budget.
3. Media and Entertainment Industry
As technology allows easier access not only to information, but also TV shows, movies, and music, any person with an internet connection can enjoy a wide selection of media content designed for public consumption and enjoyment. But with so many choices at hand, consumers have a hard time deciding what to watch or picking which music to listen to.
The good news is that companies in the media and entertainment industries help narrow down your choices by providing you with smart recommendations. Media streaming giants like Netflix and Spotify use business intelligence to create a list of recommended shows, titles, and songs based on the customer’s preferences and streaming history. This helps improve the customer’s experience and encourages them to come back for more.Netflix, in particular, implemented a strategy back in 2018 that is based on business intelligence. The strategy involved displaying ads for titles that are related to movies the subscriber just finished watching. It worked really well, prompting Netflix to fully adopt and implement its smart recommendation algorithm. Today, Netflix uses this strategy to determine 80% of the recommended content they offer to their subscribers.
That means if you just finished Stars Wars and your previously viewed titles included the likes of the Terminator, RoboCop, and Aliens, then Netflix will likely recommend top five sci-fi flicks that overlap with current technology.
BI for All Industries
Of course, it is important to note that all business intelligence features and benefits mentioned are not exclusive to a single industry—nor are they exhaustive. Many businesses harness the power of business intelligence to improve their efficiencies, enhance financial performance, attract more customers, and retain as many consumers as possible. Business intelligence can even bolster consumer data protection measures and practices against fraud and identity theft.
American Express is one such example. By combining advanced algorithms and predictive analytics, the credit card company is able to recognize potentially fraudulent transactions in real-time and automatically suspend all actions until the user confirms or declines the suspect activity. This capability is a no-brainer in today’s infosec landscape.With business intelligence software, companies are able to put all their data in a centralized hub. Access can be assigned and controlled based on user role and function. This makes it easy for the management to disseminate a single version of the truth to their employees, eliminating confusion and empowering people to communicate and collaborate more effectively.
It’s not surprising, then, that many industries are now considering it a priority to improve their business intelligence. As evidenced by the above examples, there are myriad advantages business intelligence systems bring to the table. Best of all, those benefits are applicable to all sectors willing to invest in technology enabling smart use of information.
Have you benefited from business intelligence software? We’re always curious to hear success stories, yearly priorities and favorite vendors (though we remain vendor-agnostic!). Share stories from your sector with us at email@example.com.