Techaisle recently analyzed 1,116 survey responses that provide insights needed to build and execute on analytics strategies for targeting the small and midmarket customer segments.
SMBs are prioritizing a wide range of improved outcomes within their businesses: improvement within existing operations and processes, expansion of the customer base, profitability, creation and accelerated delivery of new offerings, reduced cost, and enhanced ability to manage the unknown. Remarkably, each of the top SMB business issues can be addressed with analytics solutions – and indeed, SMBs are using analytics to address each today. Overall, SMB analytics investments are being driven primarily by productivity and process improvements with the top two reasons for SMB investments in analytics solutions as increased productivity and improved processes.
Regardless of the business issue, analytics provides an answer. And SMB analytics begins with cloud. More than 50% of both small and midmarket businesses consider cloud to be an essential analytics technology.
Survey data shows that analytics is widely deployed and solidly funded within the midmarket. The survey finds that 77% of midmarket firms (100-999 employees) have deployed analytics solutions already, as compared to less than one-third of small businesses (1-99 employees). Both also view integration of social media channels as an important capability; midmarket firms also look for real-time data analytics. However, data quality is an important inhibitor in the SMB space.
Spending on analytics is very different across two segments, with small businesses allocating an average of less than $10,000 per year to analytics, and midmarket firms allocating nearly $85,000. Small businesses are looking for managed or integrated analytics solutions whereas midmarket firms are taking a ‘roll your own’ approach.
Integration and workflow is on an ascending adoption curve. Midmarket firms are investing in integration technologies and workflow/orchestration technologies, providing evidence that analytics is moving from a means of supporting management decisions to an essential component of operational systems. Survey data shows that integration and workflow technologies are atop the list of new tool plans for midmarket firms, followed by easy-to-use tools – web dashboards, spreadsheets, online Google Analytics-type apps – that can be deployed to a wide range of staff members.
There is also steady migration from ad hoc/descriptive analytics to predictive/prescriptive analytics. The survey finds that nearly 80% small businesses describe their use of analytics as ad hoc or descriptive. Use of analytics in more advanced modes (predictive/prescriptive) is still relatively uncommon in the SMB market, with only one-third of SMBs describing this as their primary analytics approach. But the migration process has begun.