Wednesday, February 6, 2013

Getting Value from Your Data - How to Turn Data into Information

As a marketing guy, I see a lot of people toss around a lot of marketing data.  Many people provide reports that look impressive, because they have a lot of data.

Unfortunately, most people do not understand data well enough to make anything from that "fancy" report.  In fact, most people feel to foolish to admit that they don't really understand that data report.

In part, that's because that report is actually just a data dump.

It doesn't have to be this way.  Data, by itself, is not valuable...UNLESS you can turn that data into INFORMATION.

Key: Data is dull until it provides useful information.  Then it is valuable--ONLY THEN!

However, most people are not "data heads," and they don't know what to do with this "mess of numbers."

Here are the basic steps to converting data into useful information.
  1. Ask Questions
  2. Determine Data Needed
  3. Implement Data Tracking Mechanism of Method
  4. Record Data
  5. Analyze Data
  6. Summarize
  7. Take Action Based on Observations

1. Ask Questions

This is the MOST IMPORTANT step.

I see too many people grabbing data, but they don't really know why, other than they read or heard something that suggested that they "should."

As a curious person, you are going to have questions.  Some of those questions can be answered through your own logic and experience.  Other times, you can ask someone else who knows, already.  Research often turns up answers for you, also.

However, what happens if you WANT the answer, but you don't have access to it?

Often, you need more information, but your world does not provide that for you...yet.

Realize which questions you have that CANNOT be answered by your resources.

You need to know what questions you want to answer before you try to answer them.

Example #1: Which customer is providing most of our sales?

Example #2: Which domain (URL) is providing the majority of our traffic?

Example #3: Which topic seems to interest our readers the most?

Example #4: Which tasks seem to be taking my workers the longest to complete?

2. Determine Data Needed

Now that you know what QUESTION you have, figure what is keeping you from being able to answer it.

Often, there are measurements you need, but you need to gather numbers before the answer to your question appears.

Each category of data that you need is called a variable or a factor.

Figure which data variables or factors you need to help answer your question.

3. Implement Data Tracking Mechanism or Method

Now that you know WHAT you need to answer the question that you have, you need to figure HOW to get that data you need.

Maybe there is a program that measures this type of thing for you.  (i.e. Google Analytics for measuring the number of visitors to your website)

Perhaps, you need to setup your own experiment that will help you gather data.

Sometimes, it is nothing more glamorous than simply counting things, one at a time.

Just know what you are measuring and how you are going to get that measurement.  (Hint: It might not be perfect in the beginning.)

4. Record Data

Now, start gathering your data.

Know WHEN you will gather your data and HOW OFTEN.

Just make sure that you START and KEEP RECORDING data.

This is where most people fail once the process has started.  It is not hard, but it is usually the most dull part of this whole process.  It is also the most essential part of the process.

5. Analyze Data

Now that you're getting your data (or have all of your data), what are you going to do with it?

Remember Step #1: Ask Questions

Remember those questions.  What was the data supposed to answer?  Does the data seem to provide the answer, or does it seem to be a bunch of confusing noise?

Why did you want that data in the first place?  What made you think that this data would answer the question?

Does it seem like it is answering the question, or do you wish you had different type of data?

Are you noticing any other patterns in the data that does not relate directly to your original question?

Example: July provided more sales than February.  Is this coincidence, or is there something happening that might explain this?

During the analysis stage, you are trying to figure whether...
  • your question was answered
  • there is other data you really needed to help answer your question
  • there is another pattern that piques your curiosity about a different question
This is a major part of turning that data into information.

6. Summarize

Make a quick write-up, even if it is just for you to read.  However, when you put all of your observations in front of you, there is a better chance that you are now are seeing "stories" and not just numbers.

It also helps you justify your suggestions or decisions (or non-decisions).

7. Take Action Based on Observations

Of course, now that you have your INFORMATION, you need to take the action(s) that your information is suggesting to you.  Otherwise, you put together an elaborate data gathering system, but you have a story that nobody ever reads or hears.

You need to take action to benefit from that data.

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