How to Become Data Rich

October 18, 2020

The importance of being data rich with customers, especially when running a digital business can’t be understated in 2020. We hear about the importance of data all the time now. Big tech and data go hand in hand. Facebook and Google are in the business of data collection. They’re literally using all of the data we feed them to continuously iterate and serve us new products and services. “Data is the new oil” is another sentiment you hear thrown around online. But being data rich does not have to be reserved for big tech companies alone. You can utilize data to help you make better informed decisions as a startup or small business owner too.

So what is data?

Data is information. As a business owner, it is your job to be informed about your customers and your business. Knowing more about your customers and prospects gives you a competitive advantage in the market. Even if you don’t think you are a data business, I’m here to tell you that you are.

If you have paying customers, you are a data driven business. If you are small or large, it matters not, using data can help you make better informed decisions. Don’t worry about predictive analytics, artificial intelligence or data scientists just yet. As a small or medium sized business you can start improving your data hygiene almost immediately.

Why should you be data driven?

Data is everywhere, but how do we give meaning to it? As a business owner, the meaning you extract out of the data is what helps you to make better decisions.

Being data rich gives you the ability to make better informed decisions.

Data collection is the first thing you can start doing to be more data mature. This can take on many forms, whether you are collecting and tracking customer information on your website or picking up the phone and speaking with them.

The companies who can get and own data are the ones that will win. If you haven’t started this process yet, don’t worry. Many medium and large businesses are data rich but insight poor. They don’t know how to extract value from all the data they have.

On the other hand, you can start the process of good data collection today and garner insights into your customer’s biggest pain points. As a small business owner, you have the advantage of being agile and hands on when gathering your initial data. The feedback loop that you create from gathering data and using it to iterate your initial product or service will set the foundations for quality decision making as you grow.

Conducting Customer Interviews

Customer interviews are one of the most powerful tools you can use when starting your business. Gathering insights on what your customer’s needs are in relation to your solution will inform how you iterate and refine your product market fit.

The customer interview is an art in and of itself. There are many do’s and don’ts when it comes to gathering data and feedback and what questions you should and should not ask. “The Mom Test” is a book that tackles the customer interview head on and outlines the importance of asking good questions to gather good data. We created a customer interview cheat sheet, based on learnings from “The Mom Test” that you can start using to ask quality questions when speaking with customers.

Start using your customer data to make better informed decisions as a business owner. You don’t need to collect tons of data to do this. You just need to utilize the data you already have to inform better business decisions. The best source of this comes directly from your customers.

Gather feedback, learn, iterate your offering, test, grow, repeat.

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