Want to Scale Your Business? Dive into Product Analytics
Are you planning on scaling your business in the near future? Is your goal to open more locations or sell some franchises? If so, you’ll need to make some swift and sharp business decisions based on strong data. The more important data to base your decisions on is product analytics.
An overview of product analytics
When your goal is to scale your business, you need to have satisfied customers and a product worthy of scaling. While you can get a general idea of how well your business is doing by measuring your sales and returns, that’s only a surface-level view and won’t help you scale.
The purpose of product analytics is to understand how people interact with your product, whether they are a customer or a prospect. According to Amplitude.com, product analytics tells you how your customers are interacting with your product, what actions they take to make a purchase, and whether they retain or churn.
Product analytics will help you scale your business
You’ll never scale a business with an inferior product or unhappy customers. Product analytics will help you discover where you need to make improvements that will support your efforts to scale.
Product analytics help you understand your customers, which allows you to meet their needs. Meeting customer needs is a requirement for business growth. The good news is that it’s getting easier to meet or exceed customer expectations.
The 2017 American Express Customer Service Barometer survey found that 81% of Americans said businesses are meeting or exceeding their expectations. That’s a massive increase compared to 2014, when just 67% of customers felt businesses met or exceeded their service expectations.
Inc.com analyzed the American Express survey and makes an important point: when customers are happy, they spend more money. That means if you want to increase your sales and grow your business, you have to focus on customer satisfaction. Product analytics is the only way to know how satisfied your customers are.
Improve customer satisfaction through data-driven decisions
In addition to product analytics, analyzing data from several other sources will help your efforts to scale your business:
- Direct customer feedback. How many sources of customer feedback do you have? If you’re like most businesses, you’re probably doing two things: sending out surveys and generating reviews. Review sites like Yelp, Amazon, Google My Business, and Trustpilot are great platforms to generate product and business reviews. However, they don’t tell a complete story. Neither do your customer surveys. In fact, it’s hard to generate accurate, effective customer feedback from surveys and reviews alone. The problem with review sites is that sometimes competitors pay people to write bad reviews. Other times, customers express frustration and disappointment because they failed to use the product as intended or they didn’t read the full product description. Legitimate reviews are often too vague to give you any real insight into what problems customers are having. You can reply to an upset customer to find out more, but they often get snappy and unhelpful. The problem with surveys is not the survey itself, but rather the questions and structure of the survey. Surveys are effective, but only when sent out strategically. For example, effective surveys are short, ask specific questions, and are sent out within 24 hours of the initial interaction. The solution to an overwhelming amount of vague customer reviews is to sift through those reviews to find useful, specific feedback and ask for clarification whenever possible.
- Email marketing analytics. Email marketing data analytics is important. However, if you’re not getting opens and people aren’t clicking your links, it doesn’t necessarily mean there’s something wrong with your product. You might have a wonderful product and amazing customer service, but if you’re targeting the wrong market, your numbers won’t look good. Email marketing analytics gives you the insight necessary to fine-tune your target market as well as how you reach your market.
- Customer service feedback. The way your customer service team members interact with customers will directly shape their experience with your products and brand. However, your customer service department could be unintentionally undermining your efforts to improve your products. Your customer service team might also be sweeping customer complaints under the rug. For example, say a customer calls to request a refund because the product didn’t meet their expectations. Their interaction with your customer service representative will either solve their problem or drive the customer further into frustration, which could make them even more upset with your product. In that case, complaints about your product will multiply, and tiny issues will become huge. It’s tempting to brush off small complaints that seem petty, but if you want to grow your business, those small complaints are your golden ticket. Your customer service department needs to be trained to take all complaints seriously, document those complaints, and make things right with upset customers.
Pitfalls can prevent you from making data-driven decisions
Data-driven decisions are the key to growing business revenue. Unfortunately, there are pitfalls that often destroy data-driven decisions. For example, marketing expert Neil Patel points out that tradition, overwhelm, and inherent bias are the biggest obstacles to making beneficial data-driven decisions.
It’s easy for decision-makers to get into a groove. Shake things up by calling in outside expertise and encourage team members to come up with innovative, out-of-the-box ideas.
Scaling your business is directly tied to customer satisfaction
Three main metrics drive business growth: engagement, conversion, and retention. All of these metrics are directly tied to customer satisfaction, which is the driving force behind successfully scaling your business. When you get a handle on these metrics, you’ll make better business decisions, and your business will grow faster than if you were to rely on surface-level metrics or insights alone.
Insights are about as useful as a cup of coffee. They’re interesting, but insights alone won’t drive growth. The only insights that matter are insights that provide meaningful information you can use to improve your products, services, and customer experience. The more satisfied your customers, the easier and faster your business will scale.