The best way to describe Predictive Analytics is – it’s the practice of extracting information from existing data to determine patterns for predicting future outcomes and trends. While it’s not a crystal ball into the future, it can forecast what may happen with an acceptable level of reliability. Here are four ways Predictive Analytics help businesses grow:
1. Data to Determine Risks and Opportunities
Using structured and unstructured data and analysis can assist in forecasting future probabilities. When applied to a company, this might include transaction data, sales results, customer complaints, and marketing information. Having this combined knowledge helps create a better understanding of customers and products plus identifies potential risks and opportunities for future growth.
2. Better Product and Service Launches
With increased competition, businesses are always seeking an edge to bringing in new products or services in already crowded markets. Utilizing data-driven predictive models helps companies determine the best ideas to launch new products. Predictive Analytics tools replace the guesswork so companies can create product or service rollouts with higher success rates.
3. Create Accurate Forecasting
Companies also use predictive analytics to create accurate forecasting. An example would be forecasting the demand for electricity on an electrical grid. Data forecasts enable resource planning to be done more effectively. Another example would be an accurate view of future product demand. Companies can stock accordingly to meet increasing production demand spikes or reduce inventory in advance of a waning market. Using this type of forecasting, products won’t sit in storage or shipments won’t need to be rushed because companies have a clearer picture of supply and demand.
4. Combines Structured and Unstructured Information
Businesses wishing to make the most of their data should utilize the benefits of both structured and unstructured information. Predictive Analytics combines these data sets to improve predictions so businesses can efficiently and effectively move forward. Ultimately, this provides a better understanding of human behavior and allows companies to communicate opportunities tailored to customers preferences and needs.
At FocustApps, we use Predictive Analytics to help our customers become proactive by anticipating outcomes and customer behaviors that will affect their future. Our goal is to go beyond knowing what has happened and provide an assessment of what will happen to reduce risks, optimize operations, and increase revenue. For information on how we can help you, contact Blake Patterson at 502-907-6593 for details.