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How to use data analysis methods and techniques to create customer-centric marketing campaigns

Putting on your creativity cap to strategize a new marketing campaign is exciting—but what makes your hard work really feel worth it is when it resonates with your audience and performs well. 

While some marketers might be lucky enough to find a winning formula on the first try, you need to use data analysis methods to guide your campaign strategy.

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Putting customers at the center of your decision-making through data analysis helps you create relevant campaigns that connect with your audience and hit KPI goals. This guide reviews five data analysis methods marketers need to make informed decisions .

The types of data analysis a marketer uses depend on what you want to learn and which data type you have. Marketers use quantitative data—like website traffic totals—and qualitative data—like customer interview transcripts—in data analysis. There are also times when you should combine quant and qual data. 

Five data analysis methods marketers use include

Descriptive analytics to summarize quantitative data

Inferential analysis to create and test customer hypotheses

Regression analysis to compare the relationship between variables

Content analysis to quantify text-based insights

Predictive analysis to anticipate trends and learn about customer behavior 

5 popular data analysis methods for marketers

Marketers use data analytics to review performance, prioritize campaign updates, and understand customers. As you’ll see in the data analysis techniques below, the method you choose depends on what you learn and the data you collect. 

The types of data marketers most commonly use are:

Now that you know the different types of information marketers collect, use the methods below in your data analysis process to get the best results, prioritize product updates, and inform your business decisions. 

1. Descriptive analysis

When you want to measure what happened in the past, use descriptive analytics . This data analysis method summarizes quantitative data results, like how many likes a social media post got or your newsletter sign-up rate . Popular descriptive analysis methods include average, median, mode, and simply comparing survey response rates of a multiple-choice question. 

How marketers use descriptive analysis:

Benchmark organic traffic each month to understand the impact of content marketing 

Compare campaign engagement and conversion results to quarterly goals

Use surveys to measure how prevalent a goal or problem is in your customer base 

Benefits and challenges of descriptive analytics:

Many people have some experience with straightforward analysis methods like calculating an average or ranking percentage response, which makes this method quick to implement

Data collection becomes easy through existing web analytics or short surveys

Quantitative data is objective, which means there’s no room for differing interpretations

There are limitations to descriptive analytics:

The process measures an outcome but doesn’t describe why customers chose the response or behaved a certain way

You may lack context about a problem if you only look at one particular data point

You need enough data points to have statistical significance if you want to apply decisions to your entire audience confidently

❓ Pro tip: use premade survey questions to easily collect customer feedback.

Asking your audience questions with multiple-choice surveys is a great way to collect quantitative data—assuming you ask the right questions. Your research questions need to be specific enough to get relevant data but not so detailed that you accidentally lead customers to the answer you want to hear. 

Use premade survey questions and leverage Hotjar AI to generate survey questions based on your goals to collect the right data. 

Here are some survey questions marketers can use:

Where did you first hear about us?

Where else did you hear about us?

What do you use our product/service for?

Which industry does your company belong to?

How relevant is the content you found on our website?

What was your first impression of our product?

Browse 30+ ready-to-use survey templates .

Traffic attribution surveys reveal every channel customers hear about you through, instead of only seeing the referral source of your website analytics

2. Inferential analysis

Sometimes, you have a hunch but want to back up your ideas with data. Inferential analysis lets you hypothesize about your customers’ preferences and motivations by using a mix of multiple quantitative or qualitative data points . You create an inference by stacking insights observed at the same time. 

For example, an Engagement Zone heatmap combines interaction data on a website page—like clicks and scrolling—to highlight the elements visitors engage with the most. If your heatmap reveals that a particular image or headline draws visitors in, you can use it in a future campaign to test if it drives engagement across other channels.

How marketers use inferential analysis:

Ask multiple questions in a customer interview and combine common themes to create a product narrative

Research customer preferences or priorities between item categories with surveys

Compare on-page customer feedback from different referral sources to learn about your audience coming from each traffic source

Benefits and challenges of inferential analysis:

Comparing customer responses across multiple questions or touchpoints gives you a fuller understanding of user behavior

Weighing customer responses based on specific conditions—like customer segments with the highest average order value—helps you prioritize which feedback and suggestions to implement

Creating hypotheses from actual customer interactions provides campaign ideas you may not have thought about before

There are drawbacks to inferential analysis:

Your hypothesis-building can be subjective, so look for multiple customer responses or data points that validate an assumption instead of relying on a single insight

You need to collect and manage multiple data sets, which can be time-consuming

An inference is an informed guess, so you still need to test your hypothesis with A/B testing

📹 Pro tip: follow up your A/B testing analysis with recordings. 

Let’s say your A/B testing reveals that one campaign landing page far outperforms the other. Do you know why? Dig into why particular copy or design was so compelling using recordings —video playbacks of how visitors behaved on your site. Then, you can apply what you learned to future campaigns. 

Hotjar Recordings lets you see what customers see

3. Regression analysis

Regression analysis is a powerful statistical analysis method that measures the relationship between data points, like comparing whether increased marketing spending is related to more revenue . The basic process of regression analysis involves plotting your two variables on a chart and then seeing how far those points stray from the regression line. There's a correlation if the data sits close to the line. 

Since regression analysis includes multiple variables and some equations, it’s common to use a spreadsheet add-in or a tool like Tableau or The R Project .

Linear regression analysis can help answer the question, ‘Does more SEO investment lead to more sales?’ Image via PracticalEcommerce  

How marketers use regression analysis:

Discover which blogs shared on what social media channels resulted in the highest website traffic to update your social sharing strategy

Compare email engagement metrics to website sales to measure the potential impact of the channel

Learn which customer segment is happiest with your company and product through a survey to refine your targeting and messaging

Regression analysis benefits and challenges:

Measure how variables relate to one another to prove marketing impact

Evaluate what to do more of—for example, if you find a correlation between an investment or campaign and increased sales

Analyze large data sets using regression analysis tools and spreadsheets

There are downsides to regression analysis:

The process is a bit more complicated than simply checking your Google Analytics dashboard, so you’ll need a specialized tool or spreadsheet

Correlation isn’t causation, and you might not account for all potential variables that affect an outcome

A few outliers can easily skew results

4. Content analysis

Content analysis turns qualitative insights into quantifiable results to help you make conclusions about customer perspectives, perceptions, and motivations . For example, you can count how many open-ended survey question responses mentioned particular themes to rank their importance to your audience. 

Pull content analysis data from open-ended surveys, recordings of real website interactions, interviews, reviews, testimonials, social comments, and brand mentions. You could even run a content analysis on competitor reviews to find what their customers dislike to position your brand against it.

How marketers use content analysis:

Compare repeating themes across customer interviews

Map the most common customer journey steps by watching recordings to learn how customers navigate your brand’s website before purchasing

Review testimonials to discover what stands out to customers to use in future campaigns

Benefits and challenges of content analysis:

You can pull from a wide range of data sources depending on what you already have access to and the time you have to research

Quantifying responses turns subjective responses into objective numbers

It’s easier to share customer response summaries with stakeholders than sharing multiple clips or large qualitative data sets

There are obstacles with content analysis:

Manual text analysis is slow, but there are tools like Lexalytics that help

There’s still some subjectivity involved since you decide how to group responses

Reducing long responses to simple ideas can leave valuable insights behind

🗂️ Pro tip: keep your insights organized with Hotjar.

Content analysis is time consuming (but impactful!) at the best of times, but you’ll quickly get confused without organization. Hotjar Highlights lets you save and share specific insights, like a high click rate on an image (from a heatmap) or a recording snippet from your newsletter page, to stay organized and collaborate with your team.

5. Predictive analysis

Predictive analytics anticipates future trends or analyzes customer behaviors with big data sets, predictive models, artificial intelligence (AI), and machine learning tools. In other words, it’s a bit advanced. However, marketers can unlock powerful insights, like when L’Oréal and Synthesio used AI to forecast beauty trends.

If you don’t want to work with a specialized agency or consultant, there are predictive analytics tools that help marketers without advanced data analysis skills pull insights from customer data.

How marketers use predictive analytics:

Uncover new customer segments based on small differentiating behaviors and psychographics

Find related products to recommend to customers based on past purchases for personalized experiences 

Anticipate trends in your industry to create innovative campaigns

Benefits and challenges of predictive analytics:

You can review vast amounts of quantitative data faster than previously possible with technology like machine learning and AI

Nuanced customer insights and trend data give you a competitive advantage 

Easily analyze customer behavior at scale, as opposed to manually reviewing a few interview transcripts

There are drawbacks to predictive analytics:

The output is only as good as the raw data input, so incomplete or inaccurate data within a large dataset can skew results

Collecting the volume and variety of data you need for predictive analytics can be time consuming

You’ll likely need to use a specialized tool or work with a data analyst

🚦 Pro tip: monitor customer behavior with Hotjar Trends.

Hotjar Trends lets you visualize your customer behavior metrics so you can spot trends easily. 

For example, you can compare how customer segments interact with your pricing page to spot frustration or confusion that signals your marketing funnel needs an extra step. While trends don’t predict the future, continuous tracking gives you an early signal of wins or challenges. 

Hotjar makes data visualization easy, with pie charts, line graphs, or bar graphs that give you a high-level understanding of user behavior

Combine data analysis with empathy to create effective campaigns

When you’re knee-deep in spreadsheets and up to your eyes in statistics, it’s easy to view customers as just numbers on the screen. Leading with empathy and curiosity will give you a new perspective on data analysis methods. 

If you have a question, ask your customers in a survey. If you want to understand their motivations, chat with them in an interview. If you want to see how they move through your website’s marketing funnel, watch a recording of their behavior. 

Your best strategies and campaigns come from a blend of data and humanity. Simply begin with a question or hypothesis and start investigating and analyzing. 

Use customer-centric insights to drive your marketing campaigns

Hotjar’s tools give you a direct line to customers to learn about their goals, challenges, and preferences, so you create successful campaigns.

FAQs about data analysis methods for marketers

Why should marketers use data analytics.

Marketers use data analysis to review performance and understand customers, so they can create relevant campaigns.

What types of data do marketers use?

Marketers use numbers-based quantitative data, text-based qualitative data, or a combination of both for data analysis.

Which data analysis methods can marketers use?

Five data analysis methods marketers use are

Descriptive analytics

Inferential analysis

Regression analysis

Content analysis

Predictive analysis

Data analysis process

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What is data analysis, and why is it important in market research?

Market research allows businesses to uncover unique insights, find competitive advantages, and drive success. Effective data analysis is at the heart of market research, providing data-driven insight into consumer behavior, industry dynamics, and market trends.

Yet, 59% of marketers feel they don’t have the data they need to feel confident about their marketing campaigns. Struggles with data analysis are common in the marketing industry, with upward of 79% of marketers missing opportunities that could lead to higher revenue and growth.

Harnessing the power of data analysis in market research will help overcome these challenges and unlock strategic business opportunities.  

Let’s explore what data analysis is, the importance of analysis in market research , and data-backed strategies to analyze marketing data.

What is data analysis in market research?

Data analysis in market research is the process of collecting, processing, analyzing, and modeling data to create useful insight. By using large pools of market research data, you can identify trends, patterns, and connections that shape their future business strategies.

Market research data can be quantitative or qualitative. The difference between quantitative and qualitative data is that the former helps provide numerical evidence, while the latter offers insight into why a trend may occur. Quantitative data might ask a customer to rate their experience with a brand on a scale of 1-10. Qualitative data would ask that same customer to explain why they chose the number they did.

When conducting market research, there are three core data analysis methods to be aware of:

• Descriptive : Interprets data to identify trends and characteristics within the dataset.
• Predictive: Combines analysis with statistical algorithms to understand past data and make informed predictions about potential future trends.
• Prescriptive: Takes data analysis one step further by offering data-driven actionable insights that would help to optimize outcomes. 

Every department in a business draws insight from data analysis. For example, marketing data analytics will take the skills and methods of analytics and apply them to marketing-related goals and solutions. This subset of data analysis will provide marketing professionals with agile, data-driven strategies to stand out in highly competitive markets and engage potential customers.

The importance of data analysis in market research

One of the main objectives of market research is to find tangible, data-backed strategies that you can use to gain a competitive advantage. Data analysis in market research helps provide that insight, pointing companies toward ideas, points of refinement, and tactics that boost your likelihood of success.

There are several benefits of using data analysis in market research.

Identify target markets

Using data analysis in market research can help you precisely identify new target markets. By examining different demographic, behavioral, and psychographic data points, you can identify audience segments more likely to engage with your business. Different types of research will uncover distinct insights.

Perhaps buyers in a specific earning band are routinely buying competitor’s products. By identifying trends in target markets, you can begin to shape better strategies to break into new segments. 

Tailoring marketing campaigns using data analysis in market research will help locate, adapt to, and enter new markets.

Find customer insights

Customer data is one of the most valuable sources that your business has access to. Data analysis in market research is vital in uncovering connections in customer behavior and interaction. 

Customers leave a traceable trail of data across every interaction that a customer makes with your business. From spending time on your website to building up a purchase history, everything becomes a data point you can turn into valuable insight. 

For example, marketing teams may identify that certain user segments are more likely to buy a product when on sale. They could then send small coupons to this segment over email to increase the probability of a conversion. 

By adapting to customer behavior, marketing teams can more effectively engage with their audiences and meet customer demands. 

Track consumer behavior

Data analysis allows you to track how customer behavior changes over time and across different touchpoints . A customer who’s unfamiliar with your business may behave differently when compared to a long-term buyer who’s already loyal to your company. 

By analyzing data from customer touchpoints, interaction with your business, purchase statistics, and overall engagement, you can build up a comprehensive understanding of customer behavior. Conducting market research can uncover a range of insights into how different consumer segments interact with your business.

Marketing teams could monitor website analytics to see if any pages have a higher bounce rate than others. By identifying weak points in your customer journey through data analysis in market research, you can begin to fix them or reduce their impact. Data analytics on consumer behavior will help your organization streamline the customer experience and increase conversion rates.

Mitigate risk

Launching new business ventures or expanding into unfamiliar markets can pose a financial risk to businesses. Data analysis can mitigate this risk by providing predictive analytics of how changes may impact a company. 

For example, businesses could analyze historical data of how similar products have performed with their audience instead of blindly launching a new product. Businesses can better understand a decision's risk before committing to it across internal measurements, market trends, and historical industry data.

Data-driven risk mitigation will reduce uncertainty when making decisions, helping marketing teams secure budgets for new endeavors and streamline project launches. 

How to analyze data for market research

Data analytics transforms raw information into clear, precise, and useful insights that your business can use in decision-making. But great analytics doesn’t happen overnight.

Let’s explore the steps involved with analyzing data for market research.

Define objectives

While data analysis is a powerful tool, you’ll struggle to gain any useful insight without a clear purpose. Establishing a clear objective or objectives, including tracking metrics, will help point you toward the analysis you must conduct.

Choosing relevant source data will be much easier once you have a target of what you want to uncover. Equally, knowing which metrics you’ll use will help streamline the analytics process. 

Related reading: Developing a data analysis plan

Collect marketing data for analytics

You could collect all the data in the world, but if it isn’t directly related to your objectives, it isn’t useful. Collecting marketing data for analytics should align with your targets. If possible, work backward to select and capture the data you need.

For example, if you want to uncover data about customer satisfaction , you could identify that a Customer Satisfaction Survey (CSAT) would provide you with helpful information. Alternatively, you could look into other customer loyalty metrics, like Net Promoter Score® (NPS) and Customer Effort Score (CES).

Determining your objectives helps point businesses to the data they need to collect. Equally, it could suggest which previous data collections you already have could be useful in the analysis phase. 

Analyze data

Once you have all the relevant data, you can employ statistical analysis to derive insights . The methods you use to analyze your data will vary depending on your final objective. 

Here are some techniques you may use when analyzing data:

• Statistical modeling: Using statistical models to identify trends and patterns in data.
• Data visualization: Creating visual depictions of the insights you find in data, like graphs or charts.
• Machine learning and AI analysis: AI-powered market research tools can streamline analytics and expedite research.
• Correlation and causation analysis: Examining connections between variables with both quantitative and qualitative data.

In the analysis phase, you transform your raw data into precise, unique, and insightful information.

Act on data insights

Data insight isn’t just a fun statistic or an interesting graph. Data insights can provide actionable pathways for businesses to take to streamline their operations, enhance the customer experience, and drive profit. But, to get to these exciting benefits, companies must take action on the insights they uncover.

Where possible, translate data analysis into actionable insights . From there, your business can implement changes and optimize strategies based on the data you uncovered. 

By adapting your strategies and continuously monitoring and generating new data, you can build a better business one day at a time. 

Analyze your marketing data with confidence 

Data analysis in market research is a powerful tool that can drive your business toward unique insights and data-backed strategies for success.

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The 7 Most Useful Data Analysis Methods and Techniques

Data analytics is the process of analyzing raw data to draw out meaningful insights. These insights are then used to determine the best course of action.

When is the best time to roll out that marketing campaign? Is the current team structure as effective as it could be? Which customer segments are most likely to purchase your new product?

Ultimately, data analytics is a crucial driver of any successful business strategy. But how do data analysts actually turn raw data into something useful? There are a range of methods and techniques that data analysts use depending on the type of data in question and the kinds of insights they want to uncover.

You can get a hands-on introduction to data analytics in this free short course .

In this post, we’ll explore some of the most useful data analysis techniques. By the end, you’ll have a much clearer idea of how you can transform meaningless data into business intelligence. We’ll cover:

• What is data analysis and why is it important?
• What is the difference between qualitative and quantitative data?
• Regression analysis
• Monte Carlo simulation
• Factor analysis
• Cohort analysis
• Cluster analysis
• Time series analysis
• Sentiment analysis
• The data analysis process
• The best tools for data analysis
•  Key takeaways

The first six methods listed are used for quantitative data , while the last technique applies to qualitative data. We briefly explain the difference between quantitative and qualitative data in section two, but if you want to skip straight to a particular analysis technique, just use the clickable menu.

1. What is data analysis and why is it important?

Data analysis is, put simply, the process of discovering useful information by evaluating data. This is done through a process of inspecting, cleaning, transforming, and modeling data using analytical and statistical tools, which we will explore in detail further along in this article.

Why is data analysis important? Analyzing data effectively helps organizations make business decisions. Nowadays, data is collected by businesses constantly: through surveys, online tracking, online marketing analytics, collected subscription and registration data (think newsletters), social media monitoring, among other methods.

These data will appear as different structures, including—but not limited to—the following:

The concept of big data —data that is so large, fast, or complex, that it is difficult or impossible to process using traditional methods—gained momentum in the early 2000s. Then, Doug Laney, an industry analyst, articulated what is now known as the mainstream definition of big data as the three Vs: volume, velocity, and variety. 

• Volume: As mentioned earlier, organizations are collecting data constantly. In the not-too-distant past it would have been a real issue to store, but nowadays storage is cheap and takes up little space.
• Velocity: Received data needs to be handled in a timely manner. With the growth of the Internet of Things, this can mean these data are coming in constantly, and at an unprecedented speed.
• Variety: The data being collected and stored by organizations comes in many forms, ranging from structured data—that is, more traditional, numerical data—to unstructured data—think emails, videos, audio, and so on. We’ll cover structured and unstructured data a little further on.

This is a form of data that provides information about other data, such as an image. In everyday life you’ll find this by, for example, right-clicking on a file in a folder and selecting “Get Info”, which will show you information such as file size and kind, date of creation, and so on.

Real-time data

This is data that is presented as soon as it is acquired. A good example of this is a stock market ticket, which provides information on the most-active stocks in real time.

Machine data

This is data that is produced wholly by machines, without human instruction. An example of this could be call logs automatically generated by your smartphone.

Quantitative and qualitative data

Quantitative data—otherwise known as structured data— may appear as a “traditional” database—that is, with rows and columns. Qualitative data—otherwise known as unstructured data—are the other types of data that don’t fit into rows and columns, which can include text, images, videos and more. We’ll discuss this further in the next section.

2. What is the difference between quantitative and qualitative data?

How you analyze your data depends on the type of data you’re dealing with— quantitative or qualitative . So what’s the difference?

Quantitative data is anything measurable , comprising specific quantities and numbers. Some examples of quantitative data include sales figures, email click-through rates, number of website visitors, and percentage revenue increase. Quantitative data analysis techniques focus on the statistical, mathematical, or numerical analysis of (usually large) datasets. This includes the manipulation of statistical data using computational techniques and algorithms. Quantitative analysis techniques are often used to explain certain phenomena or to make predictions.

Qualitative data cannot be measured objectively , and is therefore open to more subjective interpretation. Some examples of qualitative data include comments left in response to a survey question, things people have said during interviews, tweets and other social media posts, and the text included in product reviews. With qualitative data analysis, the focus is on making sense of unstructured data (such as written text, or transcripts of spoken conversations). Often, qualitative analysis will organize the data into themes—a process which, fortunately, can be automated.

Data analysts work with both quantitative and qualitative data , so it’s important to be familiar with a variety of analysis methods. Let’s take a look at some of the most useful techniques now.

3. Data analysis techniques

Now we’re familiar with some of the different types of data, let’s focus on the topic at hand: different methods for analyzing data. 

a. Regression analysis

Regression analysis is used to estimate the relationship between a set of variables. When conducting any type of regression analysis , you’re looking to see if there’s a correlation between a dependent variable (that’s the variable or outcome you want to measure or predict) and any number of independent variables (factors which may have an impact on the dependent variable). The aim of regression analysis is to estimate how one or more variables might impact the dependent variable, in order to identify trends and patterns. This is especially useful for making predictions and forecasting future trends.

Let’s imagine you work for an ecommerce company and you want to examine the relationship between: (a) how much money is spent on social media marketing, and (b) sales revenue. In this case, sales revenue is your dependent variable—it’s the factor you’re most interested in predicting and boosting. Social media spend is your independent variable; you want to determine whether or not it has an impact on sales and, ultimately, whether it’s worth increasing, decreasing, or keeping the same. Using regression analysis, you’d be able to see if there’s a relationship between the two variables. A positive correlation would imply that the more you spend on social media marketing, the more sales revenue you make. No correlation at all might suggest that social media marketing has no bearing on your sales. Understanding the relationship between these two variables would help you to make informed decisions about the social media budget going forward. However: It’s important to note that, on their own, regressions can only be used to determine whether or not there is a relationship between a set of variables—they don’t tell you anything about cause and effect. So, while a positive correlation between social media spend and sales revenue may suggest that one impacts the other, it’s impossible to draw definitive conclusions based on this analysis alone.

There are many different types of regression analysis, and the model you use depends on the type of data you have for the dependent variable. For example, your dependent variable might be continuous (i.e. something that can be measured on a continuous scale, such as sales revenue in USD), in which case you’d use a different type of regression analysis than if your dependent variable was categorical in nature (i.e. comprising values that can be categorised into a number of distinct groups based on a certain characteristic, such as customer location by continent). You can learn more about different types of dependent variables and how to choose the right regression analysis in this guide .

Regression analysis in action: Investigating the relationship between clothing brand Benetton’s advertising expenditure and sales

b. Monte Carlo simulation

When making decisions or taking certain actions, there are a range of different possible outcomes. If you take the bus, you might get stuck in traffic. If you walk, you might get caught in the rain or bump into your chatty neighbor, potentially delaying your journey. In everyday life, we tend to briefly weigh up the pros and cons before deciding which action to take; however, when the stakes are high, it’s essential to calculate, as thoroughly and accurately as possible, all the potential risks and rewards.

Monte Carlo simulation, otherwise known as the Monte Carlo method, is a computerized technique used to generate models of possible outcomes and their probability distributions. It essentially considers a range of possible outcomes and then calculates how likely it is that each particular outcome will be realized. The Monte Carlo method is used by data analysts to conduct advanced risk analysis, allowing them to better forecast what might happen in the future and make decisions accordingly.

So how does Monte Carlo simulation work, and what can it tell us? To run a Monte Carlo simulation, you’ll start with a mathematical model of your data—such as a spreadsheet. Within your spreadsheet, you’ll have one or several outputs that you’re interested in; profit, for example, or number of sales. You’ll also have a number of inputs; these are variables that may impact your output variable. If you’re looking at profit, relevant inputs might include the number of sales, total marketing spend, and employee salaries. If you knew the exact, definitive values of all your input variables, you’d quite easily be able to calculate what profit you’d be left with at the end. However, when these values are uncertain, a Monte Carlo simulation enables you to calculate all the possible options and their probabilities. What will your profit be if you make 100,000 sales and hire five new employees on a salary of $50,000 each? What is the likelihood of this outcome? What will your profit be if you only make 12,000 sales and hire five new employees? And so on. It does this by replacing all uncertain values with functions which generate random samples from distributions determined by you, and then running a series of calculations and recalculations to produce models of all the possible outcomes and their probability distributions. The Monte Carlo method is one of the most popular techniques for calculating the effect of unpredictable variables on a specific output variable, making it ideal for risk analysis.

Monte Carlo simulation in action: A case study using Monte Carlo simulation for risk analysis

 c. Factor analysis

Factor analysis is a technique used to reduce a large number of variables to a smaller number of factors. It works on the basis that multiple separate, observable variables correlate with each other because they are all associated with an underlying construct. This is useful not only because it condenses large datasets into smaller, more manageable samples, but also because it helps to uncover hidden patterns. This allows you to explore concepts that cannot be easily measured or observed—such as wealth, happiness, fitness, or, for a more business-relevant example, customer loyalty and satisfaction.

Let’s imagine you want to get to know your customers better, so you send out a rather long survey comprising one hundred questions. Some of the questions relate to how they feel about your company and product; for example, “Would you recommend us to a friend?” and “How would you rate the overall customer experience?” Other questions ask things like “What is your yearly household income?” and “How much are you willing to spend on skincare each month?”

Once your survey has been sent out and completed by lots of customers, you end up with a large dataset that essentially tells you one hundred different things about each customer (assuming each customer gives one hundred responses). Instead of looking at each of these responses (or variables) individually, you can use factor analysis to group them into factors that belong together—in other words, to relate them to a single underlying construct. In this example, factor analysis works by finding survey items that are strongly correlated. This is known as covariance . So, if there’s a strong positive correlation between household income and how much they’re willing to spend on skincare each month (i.e. as one increases, so does the other), these items may be grouped together. Together with other variables (survey responses), you may find that they can be reduced to a single factor such as “consumer purchasing power”. Likewise, if a customer experience rating of 10/10 correlates strongly with “yes” responses regarding how likely they are to recommend your product to a friend, these items may be reduced to a single factor such as “customer satisfaction”.

In the end, you have a smaller number of factors rather than hundreds of individual variables. These factors are then taken forward for further analysis, allowing you to learn more about your customers (or any other area you’re interested in exploring).

Factor analysis in action: Using factor analysis to explore customer behavior patterns in Tehran

d. Cohort analysis

Cohort analysis is a data analytics technique that groups users based on a shared characteristic , such as the date they signed up for a service or the product they purchased. Once users are grouped into cohorts, analysts can track their behavior over time to identify trends and patterns.

So what does this mean and why is it useful? Let’s break down the above definition further. A cohort is a group of people who share a common characteristic (or action) during a given time period. Students who enrolled at university in 2020 may be referred to as the 2020 cohort. Customers who purchased something from your online store via the app in the month of December may also be considered a cohort.

With cohort analysis, you’re dividing your customers or users into groups and looking at how these groups behave over time. So, rather than looking at a single, isolated snapshot of all your customers at a given moment in time (with each customer at a different point in their journey), you’re examining your customers’ behavior in the context of the customer lifecycle. As a result, you can start to identify patterns of behavior at various points in the customer journey—say, from their first ever visit to your website, through to email newsletter sign-up, to their first purchase, and so on. As such, cohort analysis is dynamic, allowing you to uncover valuable insights about the customer lifecycle.

This is useful because it allows companies to tailor their service to specific customer segments (or cohorts). Let’s imagine you run a 50% discount campaign in order to attract potential new customers to your website. Once you’ve attracted a group of new customers (a cohort), you’ll want to track whether they actually buy anything and, if they do, whether or not (and how frequently) they make a repeat purchase. With these insights, you’ll start to gain a much better understanding of when this particular cohort might benefit from another discount offer or retargeting ads on social media, for example. Ultimately, cohort analysis allows companies to optimize their service offerings (and marketing) to provide a more targeted, personalized experience. You can learn more about how to run cohort analysis using Google Analytics .

Cohort analysis in action: How Ticketmaster used cohort analysis to boost revenue

e. Cluster analysis

Cluster analysis is an exploratory technique that seeks to identify structures within a dataset. The goal of cluster analysis is to sort different data points into groups (or clusters) that are internally homogeneous and externally heterogeneous. This means that data points within a cluster are similar to each other, and dissimilar to data points in another cluster. Clustering is used to gain insight into how data is distributed in a given dataset, or as a preprocessing step for other algorithms.

There are many real-world applications of cluster analysis. In marketing, cluster analysis is commonly used to group a large customer base into distinct segments, allowing for a more targeted approach to advertising and communication. Insurance firms might use cluster analysis to investigate why certain locations are associated with a high number of insurance claims. Another common application is in geology, where experts will use cluster analysis to evaluate which cities are at greatest risk of earthquakes (and thus try to mitigate the risk with protective measures).

It’s important to note that, while cluster analysis may reveal structures within your data, it won’t explain why those structures exist. With that in mind, cluster analysis is a useful starting point for understanding your data and informing further analysis. Clustering algorithms are also used in machine learning—you can learn more about clustering in machine learning in our guide .

Cluster analysis in action: Using cluster analysis for customer segmentation—a telecoms case study example

f. Time series analysis

Time series analysis is a statistical technique used to identify trends and cycles over time. Time series data is a sequence of data points which measure the same variable at different points in time (for example, weekly sales figures or monthly email sign-ups). By looking at time-related trends, analysts are able to forecast how the variable of interest may fluctuate in the future.

When conducting time series analysis, the main patterns you’ll be looking out for in your data are:

• Trends: Stable, linear increases or decreases over an extended time period.
• Seasonality: Predictable fluctuations in the data due to seasonal factors over a short period of time. For example, you might see a peak in swimwear sales in summer around the same time every year.
• Cyclic patterns: Unpredictable cycles where the data fluctuates. Cyclical trends are not due to seasonality, but rather, may occur as a result of economic or industry-related conditions.

As you can imagine, the ability to make informed predictions about the future has immense value for business. Time series analysis and forecasting is used across a variety of industries, most commonly for stock market analysis, economic forecasting, and sales forecasting. There are different types of time series models depending on the data you’re using and the outcomes you want to predict. These models are typically classified into three broad types: the autoregressive (AR) models, the integrated (I) models, and the moving average (MA) models. For an in-depth look at time series analysis, refer to our guide .

Time series analysis in action: Developing a time series model to predict jute yarn demand in Bangladesh

g. Sentiment analysis

When you think of data, your mind probably automatically goes to numbers and spreadsheets.

Many companies overlook the value of qualitative data, but in reality, there are untold insights to be gained from what people (especially customers) write and say about you. So how do you go about analyzing textual data?

One highly useful qualitative technique is sentiment analysis , a technique which belongs to the broader category of text analysis —the (usually automated) process of sorting and understanding textual data.

With sentiment analysis, the goal is to interpret and classify the emotions conveyed within textual data. From a business perspective, this allows you to ascertain how your customers feel about various aspects of your brand, product, or service.

There are several different types of sentiment analysis models, each with a slightly different focus. The three main types include:

Fine-grained sentiment analysis

If you want to focus on opinion polarity (i.e. positive, neutral, or negative) in depth, fine-grained sentiment analysis will allow you to do so.

For example, if you wanted to interpret star ratings given by customers, you might use fine-grained sentiment analysis to categorize the various ratings along a scale ranging from very positive to very negative.

Emotion detection

This model often uses complex machine learning algorithms to pick out various emotions from your textual data.

You might use an emotion detection model to identify words associated with happiness, anger, frustration, and excitement, giving you insight into how your customers feel when writing about you or your product on, say, a product review site.

Aspect-based sentiment analysis

This type of analysis allows you to identify what specific aspects the emotions or opinions relate to, such as a certain product feature or a new ad campaign.

If a customer writes that they “find the new Instagram advert so annoying”, your model should detect not only a negative sentiment, but also the object towards which it’s directed.

In a nutshell, sentiment analysis uses various Natural Language Processing (NLP) algorithms and systems which are trained to associate certain inputs (for example, certain words) with certain outputs.

For example, the input “annoying” would be recognized and tagged as “negative”. Sentiment analysis is crucial to understanding how your customers feel about you and your products, for identifying areas for improvement, and even for averting PR disasters in real-time!

Sentiment analysis in action: 5 Real-world sentiment analysis case studies

4. The data analysis process

In order to gain meaningful insights from data, data analysts will perform a rigorous step-by-step process. We go over this in detail in our step by step guide to the data analysis process —but, to briefly summarize, the data analysis process generally consists of the following phases:

Defining the question

The first step for any data analyst will be to define the objective of the analysis, sometimes called a ‘problem statement’. Essentially, you’re asking a question with regards to a business problem you’re trying to solve. Once you’ve defined this, you’ll then need to determine which data sources will help you answer this question.

Collecting the data

Now that you’ve defined your objective, the next step will be to set up a strategy for collecting and aggregating the appropriate data. Will you be using quantitative (numeric) or qualitative (descriptive) data? Do these data fit into first-party, second-party, or third-party data?

Learn more: Quantitative vs. Qualitative Data: What’s the Difference? 

Cleaning the data

Unfortunately, your collected data isn’t automatically ready for analysis—you’ll have to clean it first. As a data analyst, this phase of the process will take up the most time. During the data cleaning process, you will likely be:

• Removing major errors, duplicates, and outliers
• Removing unwanted data points
• Structuring the data—that is, fixing typos, layout issues, etc.
• Filling in major gaps in data

Analyzing the data

Now that we’ve finished cleaning the data, it’s time to analyze it! Many analysis methods have already been described in this article, and it’s up to you to decide which one will best suit the assigned objective. It may fall under one of the following categories:

• Descriptive analysis , which identifies what has already happened
• Diagnostic analysis , which focuses on understanding why something has happened
• Predictive analysis , which identifies future trends based on historical data
• Prescriptive analysis , which allows you to make recommendations for the future

Visualizing and sharing your findings

We’re almost at the end of the road! Analyses have been made, insights have been gleaned—all that remains to be done is to share this information with others. This is usually done with a data visualization tool, such as Google Charts, or Tableau.

Learn more: 13 of the Most Common Types of Data Visualization

To sum up the process, Will’s explained it all excellently in the following video:

5. The best tools for data analysis

As you can imagine, every phase of the data analysis process requires the data analyst to have a variety of tools under their belt that assist in gaining valuable insights from data. We cover these tools in greater detail in this article , but, in summary, here’s our best-of-the-best list, with links to each product:

The top 9 tools for data analysts

• Microsoft Excel
• Jupyter Notebook
• Apache Spark
• Microsoft Power BI

6. Key takeaways and further reading

As you can see, there are many different data analysis techniques at your disposal. In order to turn your raw data into actionable insights, it’s important to consider what kind of data you have (is it qualitative or quantitative?) as well as the kinds of insights that will be useful within the given context. In this post, we’ve introduced seven of the most useful data analysis techniques—but there are many more out there to be discovered!

So what now? If you haven’t already, we recommend reading the case studies for each analysis technique discussed in this post (you’ll find a link at the end of each section). For a more hands-on introduction to the kinds of methods and techniques that data analysts use, try out this free introductory data analytics short course. In the meantime, you might also want to read the following:

• The Best Online Data Analytics Courses for 2024
• What Is Time Series Data and How Is It Analyzed?
• What is Spatial Analysis?

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Data Analytics in Marketing Research: Definition, Types, Process, and More

Data Analytics is a critical function affecting all aspects of the business. This article covers broad data analytic topics for those new to the area of data analytics. At Sawtooth Software, we focus on marketing research and primary data collection through survey research, so this article specifically calls out the use of data analytics in marketing sciences.

Before diving deep into the breadth of data analytics, let’s summarize key takeaways you will gain from this guide:

With that introduction, let’s dive deeper into the field of Data Analytics .

Table of Contents

What Is Data Analytics?

At its core, Data Analytics involves the computational analysis of data or statistics. Data can involve numeric values, text, graphics, video or audio files. The value of data analytics lies in its ability to transform vast amounts of raw, often unstructured data into actionable insights. These insights can then guide decision-making, optimize operations, and unveil opportunities for innovation.

Consider a retail business that leverages data analytics to understand customer purchasing patterns, preferences, and behaviors. By analyzing sales data, customer feedback, social media trends, along with primary survey data, the business can tailor its product offerings, improve customer service, predict future trends, and optimize products and pricing for new or existing products. This practical application underscores the transformative power of data analytics in driving business strategy and growth.

Data Analytics vs. Data Science

While often used interchangeably, Data Analytics and Data Science involve nuanced differences, with complementary roles within an organization. Data Analytics focuses on processing and performing statistical analysis on existing datasets. In contrast, Data Science typically involves heavier programming, developing algorithms, and model-building to derive additional insights to solve complex problems and predict future outcomes. Data scientists often leverage machine learning and AI (Artificial Intelligence) in building algorithms, models, and applications.

The impact of both fields on Decision-Making is important. Data analytics provides a more immediate, focused insight primarily aimed at enhancing operational efficiency and answering specific questions. Data Science, on the other hand, dives deeper into predictive analysis, machine learning, and AI to forecast future trends and behaviors.

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Types of Data Analysis

Data Analysis can be broadly categorized into four main types, each serving a unique purpose in the data analytics landscape. Understanding these types helps you to apply the right analytical approach to your data to derive meaningful conclusions and strategies.

Descriptive Analytics

This type of analytics focuses on the “what” and is the most basic and commonly used. For market research surveys, descriptive analytics summarizes responses to demographic, psychographic, attitudinal, brand usage data, and the like. For historical data, it aims to provide a clear picture of what has happened in the past by summarizing such things as sales data, operations data, advertising data, and website click traffic. Descriptive analytics answers the "What happened?" question by analyzing key performance indicators (KPIs) and metrics. For example, a business might use descriptive analytics to understand its sales trends, customer engagement levels, or production efficiencies over the past year.

Diagnostic Analytics

Moving beyond the “what” to understand the “why,” diagnostic analytics involves a deeper dive into data to examine patterns of association or correlation, with the hope to uncover root causes of attitudes, preference, events or trends. It employs techniques such as correlation analysis, t-tests, chi-square tests, key drivers analysis, and tree-based analysis (such as CART or random forests). For customer satisfaction research key drivers analysis tries to explain how overall customer satisfaction or loyalty can be improved by improving the features or elements of the product or service delivery. An organization might also leverage diagnostic analytics to identify why certain groups of respondents are more likely to be price sensitive or why customer churn increased in a specific period.

Predictive Analytics

This forward-looking analysis leverages data and models that can predict future outcomes. Conjoint analysis is a widely used predictive analytics approach for studying how changes to product features and prices affect demand. MaxDiff (best-worst scaling) is often used to assess which product claims will likely increase new product trial, or which side effects would most discourage patients from undergoing a cancer treatment therapy. Machine learning algorithms such as random forests can score a database to predict which customers are most likely to be receptive to an offer. As another example, a financial institution might use predictive analytics to assess the risk of loan default based on a customer's credit history, transaction data, and market conditions.

Prescriptive Analytics

An advanced form of analytics, prescriptive analytics, goes a step further by recommending actions you can take to affect desired outcomes. It not only predicts what will happen but also suggests various courses of action and the potential implications of each. This type of analytics is particularly valuable in complex decision-making environments. For example, a conjoint analysis market simulator leveraging optimization search routines can determine the right mix of product features and price to reach a particularly valuable market segment .

Each of these types of data analysis plays a critical role in an organization's data-driven decision-making process, enabling businesses to understand their past performance, diagnose issues, create successful products and services, predict future trends, and make informed choices that align with their strategic objectives.

Data Analytics Real-World Example

Consider the case of a data analyst working for an e-commerce platform. By analyzing customer purchase history, the analyst identifies a trend of increased sales in eco-friendly products ( descriptive analytics , the “what”). A survey is designed and conducted to dig deeper into which customers are preferring eco-friendly products, why they prefer them, and for which usage occasions ( diagnostic analytics , the “why”). Within another market research survey, a conjoint analysis or MaxDiff study is included for determining the right product claims, product features, and pricing, targeted to which market segments to develop new products for sales growth ( predictive and prescriptive analytics ).

The role of a data analyst is dynamic and impactful, bridging the gap between data and strategic decision-making. It's a role that requires not only technical skills but also curiosity, creativity, and a keen understanding of the business landscape.

The Data Analysis Process

Breaking down a data analytics process into systematic steps can demystify the journey, making it more approachable and manageable. The Data Analysis Process is a structured approach that guides data analysts from the initial phase of understanding the business problem to the final stage of delivering actionable insights.

Step 1: Defining the Question

The first and perhaps most critical step in the data analysis process is defining the question . This involves understanding the business objectives, the decisions that need to be supported by the data, and the specific questions that the analysis aims to answer. A well-defined question not only provides direction for the analysis but also ensures that the outcomes are relevant and actionable.

Step 2: Collecting Clean Data

Data collection is the next step, where data analysts gather the necessary data from various sources. This could include internal databases, secondary sources of data, customer surveys, and more. Ensuring the cleanliness of the data is paramount at this stage; hence, data cleaning and preprocessing become essential tasks. This involves removing inaccuracies, inconsistencies, handling missing values, and trimming outliers to ensure the data is reliable and accurate for analysis. For market research surveys, this also involves identifying unreliable respondents, fraudulent respondents, and records completed by survey bots.

Step 3: Data Analysis and Interpretation

With clean data in hand, analysts proceed to the heart of the process: data analysis and interpretation . This involves applying statistical methods and analytical models to the data to identify patterns, trends, and correlations. The choice of techniques varies depending on the data and the questions at hand, ranging from simple descriptive statistics to complex predictive models.

Step 4: Data Visualization and Sharing Findings

Data visualization plays a crucial role in this phase, as it transforms complex data sets into visual representations that are easier to understand and interpret. Tools like charts, graphs, and dashboards are used to illustrate the findings compellingly and intuitively.

Finally, sharing the findings with stakeholders is an integral part of the data analysis process. This involves not just presenting the data, but also providing insights, recommendations, and potential implications in a clear and persuasive manner. Effective communication is key here, as the ultimate goal is to inform decision-making and drive action based on the data insights.

For product optimization and pricing research, market simulators from conjoint analysis can be even more useful to a decision-maker than charts and graphs. They allow the manager to test thousands of potential product formulations and prices, to find the right products to best reach target market segments.

Example Scenario

Imagine a data analyst working for a healthcare provider, tasked with reducing patient wait times. By following the data analysis process, the analyst:

• Defines the question: What factors contribute to increased wait times?
• Collects and cleans data from patient records, appointment systems, and feedback surveys.
• Analyzes the data to identify patterns, such as peak times for appointments and common delays in the patient check-in process.
• Visualizes the findings using graphs that highlight peak congestion times and the factors causing delays.
• Shares the insights with the healthcare management team, recommending adjustments to appointment scheduling and check-in processes to reduce wait times.

This systematic approach not only provides actionable insights but also showcases the power of data analytics in solving real-world problems.

Understanding the data analysis process is foundational for anyone looking to delve into data analytics, providing a roadmap for transforming data into insights that can drive informed decision-making.

Tools and Techniques

The field of Data Analytics is supported by a variety of tools and techniques designed to extract, analyze, and interpret data. Market research surveys are often a key source of data. The choice of the right analytics tools and the application of specific analytical techniques can significantly impact the quality of the insights generated. In this section, we will explore some of the key data analytics techniques and highlight commonly used tools, especially for primary survey research, providing tips on how to choose the right ones for specific projects.

Key Data Analytics Techniques

Statistical Testing: When summarizing data using means (for continuous data) or percent of observations falling into different categories (for categorical or nominal data), we often want to know whether the differences we’re observing between groups of respondents, branches of a company, or time periods are statistically meaningful (that they were unlikely to occur by chance).

Correlation Analysis : A statistical approach that examines whether there is a positive, negative, or no correlation between two continuous variables. The square of the correlation coefficient indicates the percent of variance in one variable that is explained by the other.

Regression Analysis : A statistical method used to examine the relationship between dependent (outcome) and independent (predictor) variables. There are regression techniques for predicting continuous variables (ordinary least squares) as well as for categorical outcomes (logistic regression). Regression analysis is particularly useful for identifying relationships between variables, making predictions, and forecasting.

Tree-Based Analysis : These techniques are used for finding which variables tend to predict or explain some outcome, such as purchase of a product, or diagnosis with a disease. Common examples are Classification and Regression Trees (CART) and Random Forests, a combination of multiple trees that can be ensembled for a more accurate consensus prediction.

Time-Series Analysis : Focused on analyzing data points collected or recorded at specific time intervals. This technique is crucial for trend analysis, seasonal pattern identification, and forecasting.

Cluster Analysis : A family of methods used to group a set of objects (such as respondents) in such a way that objects in the same group (called a cluster) are more similar to each other than to those in other groups. It’s extensively used in market segmentation and targeting strategies. Common approaches include k-means clustering, latent class clustering, and ensemble approaches that leverage multiple techniques to achieve a more robust consensus solution.

Conjoint Analysis and MaxDiff: Discrete choice methods often used in market research and economics for assessing the importance of features, measuring price sensitivity , and predicting demand for products or services.

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Commonly Used Data Analytics Tools

Excel : A versatile tool for basic data analysis, familiar to most professionals, capable of handling various data analysis functions including pivot tables, basic statistical functions, and data visualization.

SQL : Essential for data extraction, especially from relational databases. SQL allows analysts to query specific data from large databases efficiently.

Python/R : Both are powerful programming languages favored in data analytics for their libraries and packages that support data manipulation, statistical analysis, and machine learning.

Tableau/Power BI : These tools are leaders in data visualization, providing robust platforms for creating dynamic and interactive dashboards and reports.

Sawtooth Software : Provides tools, support services, and consulting services for designing and fielding market research surveys, as well as conducting conjoint analysis, MaxDiff, and cluster analysis.

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Choosing the Right Tools and Techniques

Selecting the appropriate tools and techniques depends on several factors:

Project Requirements : The nature of the data and the specific questions you are trying to answer will guide your choice. For instance, Python might be preferred for its machine learning capabilities, while Tableau is chosen for sophisticated visualizations.

Data Size and Complexity : Large datasets and complex analyses might require more advanced tools like Python or R, whereas Excel (limited to around 1 million rows and 16 thousand columns) could suffice for smaller, simpler datasets.

Skill Set : The proficiency of the data analyst in using these tools also plays a significant role. It’s essential to balance the choice of tool with the analyst's comfort level and expertise.

Budget and Resources : Some tools require significant investment, both in terms of licenses and training. Open-source options like Python and R offer powerful functionalities at no cost.

Example Application

Consider a retail company looking to optimize its inventory levels based on historical sales data. The data analyst might use:

• SQL to extract sales data from the company's database.
• Python for conducting time-series analysis to identify sales trends and predict future demand.
• Tableau to create visualizations that illustrate these trends and forecasts, facilitating strategic discussions on inventory management.

Through the strategic application of these tools and techniques, data analysts can uncover valuable insights that drive informed decision-making and strategic planning within organizations.

The exploration of tools and techniques underscores the versatility and power of data analytics. Whether through statistical analysis, predictive modeling, or insightful visualizations, these tools empower analysts to turn data into strategic assets.

Importance and Uses of Data Analytics

Data analytics has become a pivotal element of business strategy, influencing decisions across all levels of an organization. Its importance cannot be overstated, as it provides the insights needed for businesses to innovate, stay competitive, and improve operational efficiency. This section explores the significance of data analytics across various domains, including healthcare, product optimization and pricing, and its relevance for small enterprises and startups.

Embracing data analytics allows organizations to move from intuition-based decisions to informed strategies. As we advance, the integration of data analytics into every aspect of business operations and strategy will become more pronounced, highlighting its critical role in shaping the future of industries worldwide.

Transforming Business Success

Data analytics empowers businesses to make informed decisions by providing a deep understanding of customer behavior, market trends, and operational performance. It enables companies to:

• Optimize Operations : By analyzing data, businesses can identify inefficiencies in their operations and find ways to reduce costs and improve productivity.
• Enhance Customer Experience : Data analytics allows businesses to understand their customers' preferences and behaviors, leading to improved revenues, customer satisfaction and loyalty.
• Product Innovation/Optimization and Pricing : Survey research methods such as conjoint analysis and MaxDiff are especially useful for optimizing features for and pricing products/services, keeping companies at the forefront of innovation and competitiveness.

In healthcare, data analytics plays a critical role in improving patient outcomes and operational efficiency. By analyzing patient data, healthcare providers can:

• Predict Outbreaks : Data analytics can help in predicting disease outbreaks, enabling healthcare systems to prepare and respond effectively.
• Personalize Treatment : Analytics (including MaxDiff and conjoint analysis) can elicit real-time preferences from patients that can lead to better personalized treatment plans, improving patient care and outcomes. Several groups of physicians and academic researchers have presented research at Sawtooth Software conferences on using these tools for facilitating better communication between patients and doctors and selecting treatment plans for diseases such as cancer to result in improved outcomes.
• Improve Operational Efficiency : Data analytics can optimize hospital operations, reducing wait times and improving patient flow.

Product Optimization and Pricing

Repositioning existing products, developing new products, and setting effective pricing strategies are vital to most any business. By using gold standard tools for survey research such as conjoint analysis and MaxDiff, businesses can:

• Find Optimal Sets of Features : Conjoint analysis can within a single survey research project evaluate 1000s of potential feature configurations, determining which feature sets will compete best relative to specific competitors.
• Identify Profitable Target Segments : Conjoint analysis or MaxDiff are excellent techniques for identifying and sizing market segments that have specific needs and are associated with different levels of price sensitivity.
• Measure Price Elasticity: Choice-Based Conjoint (CBC) analysis is particularly valuable for estimating price elasticity of demand for the firm’s brand(s), as well as assessing how changes to competitor’s prices affect quantity demanded for the firm’s brand(s) ( cross-elasticity ).

Relevance for Small Enterprises and Startups

For small enterprises and startups, data analytics offers a competitive edge, enabling them to:

• Make Informed Decisions : Even with limited resources, small businesses can use data analytics to make strategic decisions based on market trends and customer feedback.
• Identify Opportunities : Analytics can reveal market gaps and customer needs, providing startups with insights to innovate and capture new markets.

The Role of a Data Analyst

In the heart of data-driven organizations lies the Data Analyst , a professional whose responsibilities are as varied as they are critical. Understanding the role of a data analyst not only highlights the importance of data analytics in modern business but also sheds light on the skills and perspectives needed to excel in this field.

Responsibilities and Tasks

A data analyst's journey often begins with problem formulation and developing hypotheses and strategies for solving a business or organizational problem. Next often follows data collection, ensuring the quality and accuracy of the data sourced from various channels, including survey research. This foundational step is critical, as the integrity of the data directly impacts the insights derived from it. The analyst then proceeds to clean and preprocess the data, preparing it for analysis. This involves handling missing values, removing duplicates, trimming outliers, and ensuring the data is in a format suitable for analysis.

The core of a data analyst's role involves statistical analysis and data modeling to interpret the data. They employ a range of techniques, from simple descriptive statistics to more complex predictive models, to unearth trends, patterns, and correlations within the data.

However, the role extends beyond just analyzing data. Data visualization and reporting are equally important, as these allow the analyst to communicate their findings in a clear, compelling manner. Whether through dashboards, reports, or presentations, the ability to present data in an accessible way is crucial for informing decision-making processes within an organization.

Professional Insights

From the perspective of a seasoned data analyst, the job is not just about numbers and algorithms; it's about solving challenging business and organizational problems and storytelling with data. It involves translating complex datasets into actionable insights that can drive strategy and impact. An effective data analyst combines analytical skills with business acumen, understanding the broader context in which the data exists.

Career Opportunities in Data Analytics

The field of data analytics offers a dynamic career landscape, characterized by a high demand for skilled professionals capable of turning data into actionable insights. As businesses across industries continue to recognize the value of data-driven decision-making, the demand for data analysts has surged, creating a wealth of opportunities for those equipped with the right skills and knowledge. This section will explore career prospects, including job growth, and discuss the relevance of degrees and certifications in data analytics.

Job Growth and Demand

The demand for data analysts is projected to grow significantly in the coming years. According to industry reports and labor statistics, the job market for data analysts is expected to grow much faster than the average for all occupations. This growth is driven by the increasing volume of data generated by businesses and the need to analyze this data to make informed decisions.

• Projected Job Growth : Data analytics roles are expected to see one of the highest rates of job growth across all sectors.
• Industries Hiring : While technology and finance traditionally lead in hiring data analysts, healthcare, marketing, and retail are rapidly catching up, reflecting the broad applicability of data analytics skills.

Salary Ranges

Salaries for data analysts can vary widely based on experience, location, and industry. However, data analysts typically command competitive salaries, reflecting the high demand and specialized skill set required for the role.

• Entry-Level Positions : Even at entry levels, data analysts can expect salaries that are competitive, with potential for rapid growth as experience and skills develop.
• Senior Roles : Experienced data analysts, especially those with specialized skills or leadership roles, can command significantly higher salaries.

Degrees and Certifications

While a degree in data science, statistics, computer science, or a related field can provide a strong foundation, the field of data analytics also values practical experience and specialized skills.

• Relevant Degrees : Bachelors and masters degrees in relevant fields are highly valued, but not always required.
• Certifications : Certifications can supplement academic degrees and provide evidence of specialized skills in data analytics tools and methodologies. Popular certifications include Certified Analytics Professional (CAP), Google Data Analytics Professional Certificate, and various platform-specific certifications (e.g., Tableau, SAS).

Making It in Data Analytics

Success in a data analytics career is not solely determined by technical skills. Employers also value problem-solving abilities, business acumen, and the capacity to communicate complex findings in a clear and actionable manner. Continuous learning and adaptation to new tools, technologies, and methodologies are essential in this rapidly evolving field.

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Data analytics is not just a tool but a strategic asset that can drive significant business value, enhance operational efficiency, and foster innovation across various sectors. From improving healthcare outcomes to enabling small businesses to compete more effectively, the applications of data analytics are vast and varied.

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Handbook of Market Research

• Living reference work
• © 2020
• 0th edition
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• Christian Homburg 0 ,
• Martin Klarmann 1 ,
• Arnd Vomberg 2

Universität Mannheim, Mannheim, Germany

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Inst. Informations Systems and Marketing Marketing & Sales Research Group, Karlsruher Institut für Technologie, Karlsruhe, Germany

Fakultät für Betriebswirtschaftslehre, Universität Mannheim, Mannheim, Germany

• Covers a very broad spectrum of important market research methods, both quantitative and qualitative
• Written by an experts market research Provides an intuitive understanding of the material, including an application examples and the technical basis of the methods

46k Accesses

1522 Citations

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Table of contents (33 entries)

Return on media models.

• Dominique M. Hanssens

Experiments in Market Research

• Torsten Bornemann, Stefan Hattula

Field Experiments

• Veronica Valli, Florian Stahl, Elea McDonnell Feit

Crafting Survey Research: A Systematic Process for Conducting Survey Research

• Arnd Vomberg, Martin Klarmann

Challenges in Conducting International Market Research

• Andreas Engelen, Monika Engelen, C. Samuel Craig

Dealing with Endogeneity: A Nontechnical Guide for Marketing Researchers

• P. Ebbes, D. Papies, H. J. van Heerde

Fusion Modeling

• Elea McDonnell Feit, Eric T. Bradlow

Modeling Marketing Dynamics Using Vector Autoregressive (VAR) Models

• Shuba Srinivasan

Cluster Analysis in Marketing Research

• Thomas Reutterer, Daniel Dan

Finite Mixture Models

• Sonja Gensler

Factor Analysis

• Hans Baumgartner, Christian Homburg

Structural Equation Modeling

• Hans Baumgartner, Bert Weijters

Partial Least Squares Structural Equation Modeling

• Marko Sarstedt, Christian M. Ringle, Joseph F. Hair

Analysis of Variance

• Jan R. Landwehr

Regression Analysis

• Bernd Skiera, Jochen Reiner, Sönke Albers

Multilevel Modeling

• Till Haumann, Roland Kassemeier, Jan Wieseke

Panel Data Analysis: A Nontechnical Introduction for Marketing Researchers

• Arnd Vomberg, Simone Wies

Logistic Regression and Discriminant Analysis

• Sebastian Tillmanns, Manfred Krafft

Modeling Customer Lifetime Value, Retention, and Churn

• Herbert Castéran, Lars Meyer-Waarden, Werner Reinartz

Choice-Based Conjoint Analysis

• Felix Eggers, Henrik Sattler, Thorsten Teichert, Franziska Völckner

Editors and Affiliations

Christian Homburg

Inst. Informations Systems and Marketing Marketing & Sales Research Group, Karlsruher Institut für Technologie, Karlsruhe, Germany

Martin Klarmann

Arnd Vomberg

About the editors

Prof. Arnd Vomberg  is an Associate Professor at the Marketing Department of the University of Groningen. Previously, he was an Assistant Professor for Empirical Methods at the University of Mannheim. Professor Vomberg’s research focuses on digital marketing and marketing transformation. He studies omnichannel strategies, online pricing, marketing automation, agile transformation, marketing technology, and marketing’s impact on employees. His research has been published in several leading journals of the field, including Journal of Marketing, Journal of Marketing Research, Strategic Management Journal, Journal of the Academy of Marketing Science, and International Journal of Research in Marketing. Professor Vomberg has received several awards for his research, including the Ralph Alexander Best Dissertation Award from the Academy of Management.

Bibliographic Information

Book Title : Handbook of Market Research

Editors : Christian Homburg, Martin Klarmann, Arnd Vomberg

DOI : https://doi.org/10.1007/978-3-319-05542-8

Publisher : Springer Cham

eBook Packages : Springer Reference Business and Management , Reference Module Humanities and Social Sciences , Reference Module Business, Economics and Social Sciences

eBook ISBN : 978-3-319-05542-8 Due: 28 November 2024

Topics : Marketing , Market Research/Competitive Intelligence , Sales/Distribution , Business Strategy/Leadership , Organization

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