I had the pleasure of discussing data, and specifically growth through data, with Kyle York of York IE. And since his name’s on the front door at his shop, you can make a safe bet that he had some super valuable insights.
In this article, I wanted to dive a bit deeper into the topics we covered, including the various approaches to growth through data, and specific aspects of the growth process that most of us don’t think about often enough. So grab a coffee or a Red Bull or a kombucha or water (if you want to be “healthy” or whatever) and get ready to grow.
Different approaches to data
Before I get ahead of myself, let’s start from square one: what does it even mean to “grow through data?” As cool as it would be to plant some sort of data bean that will propel our companies forward, the real answer is a little more involved.
In any business, one of the first steps to success is keeping good records and collecting good data. With this data, you can analyze your performance, the market’s performance, and any other factors that will affect your business.
Then, you can adapt. This ability to adapt is what will ultimately lead to growth, as it will ensure continued success in an ever-changing environment.
Now that we’re all on the same page, it’s important to understand the various ways in which one could promote growth through data collection and analysis. Any and all data collection for your business will fall into one of two categories: internal and external.
As you might imagine, internal data deals with metrics specific to your operations, like tracking orders, profit margins, employee satisfaction, etc. External data, of course, refers to any factors outside of your business that could affect your success, such as market conditions, changes happening at competitor’s businesses, or any other factors that are out of your control.
Know what you’re up against
Because the latter category, external data, is what we spoke about most in the episode, it’s what I’ll break down first. But don’t worry, we’ll get back to keeping your homebase in order later on.
During our chat, Kyle explained to me that in his experience, many businesspeople who are entering the market with a new product focus far too much on their own product, and nowhere near enough on the market they’re getting themselves into. This is why, when investing in startups, he places so much importance on being both an operator and an investor.
In order to identify the best companies to invest in, he needs to understand the market and what they’re up against.
In order to accomplish this goal, he set up a platform for market competitive intelligence, which means he is taking a market-in approach. In his platform, he tracks any and every piece of market info you could imagine, including supply chain info, market conditions and projections, prices, product features, and even SEO terms that are most valuable in certain industries. He then uses all of this info to identify which companies in that market have the best chance of success, so that he can make wise investment decisions.
Furthermore, once he chooses to invest, his clients now have a leg up, as they have backing from someone with unparalleled market intelligence. It feels counterintuitive to anyone without experience in this field, but focusing on what competitors are doing often makes what you’re doing better.
So, all of this data will prepare Kyle and his clients for success, as long as they analyze it effectively.
My approach, and the approach we use here at EMM, is what we would call a “product-out” approach. This approach focuses on identifying ways in which you can improve your product that the market can’t tell you, so it often means finding your niche and filling a gap that no one else is filling.
Think of it like this: if Steve Jobs had focused more on what everyone else was doing, the iPhone would have just been a cooler looking Blackberry. Instead, he and his colleagues found a gap that nobody else even knew existed, and ran with it.
That’s what the product-out approach is all about: identifying and creating what people want, before they even know they want it.
Having said that, we do still look at the competition. Some of our methods are a little less direct than Kyle’s, but if you know what you’re looking at, they’re just as valuable.
first example: Email decay
For example, since my colleagues and I specialize in B2B email databases and similar datasets, we look a lot at decay of email rates within companies.
On the surface, this sounds like a boring metric, but it actually gives you a lot of info on how well a company is performing. If their email lists are decaying at a high rate, that means they are losing employees. Whether that’s because they’re getting laid off or quitting isn’t the point; the point is, their team is dwindling and their future probably isn’t too bright if they can’t afford to pay or maintain their team.
Second Example: Bad emails
Another example could be an entire data set of bad emails, or simply, all the ones that don't deliver. Again, you initially look at this and think to yourself, "Who would want bad emails? Don't I specifically buy newer and 'fresh' email data for the purpose of it delivering?"
You'd be correct, but you may also be overlooking a very crucial use-case with bad data. Why not take all these contacts that you know to be stale and match with your current database? This way, you can identify the bad apples in your (data) orchard quickly and remove them before they make hay on your delivery rates.
"Outside of the box" data solutions
That’s the gist of what we do; we look at metrics that are less obviously linked to growth and success, and make sense of them to learn about the market just as Kyle does. These two examples are only a small portion of what we do too.
As a vendor with one of the largest wholly owned B2B and B2C email databases in the industry, we can do some pretty neat things. And of course, we can do the routine stuff as well. Want a deep dive into what else we can do? Send us a message and we'd love to break it down and find which solution is the best for you.
External data is a two lane highway
As we outlined in the episode and I touched on here already, external data compilation and analysis generally serves one of two purposes: investing or prospecting.
In Kyle’s case, or in many cases similar to his, the purpose of researching, collecting, and analyzing data would be to invest in whichever companies you believe are most likely to profit.
In my case, or in the case of any business selling a product or service, the purpose is to identify potential clients and learn the best ways to gain and keep their business. Regardless of which side of the coin you’re on, it’s crucial to understand the marketplace.
Don’t forget to look within
As promised, I also want to emphasize the importance of regularly collecting and analyzing internal data. This could deal with metrics such as sales, client relationship management (you didn’t think I’d write an entire article without mentioning CRM did you?), or even regularly sending out employee surveys.
You don’t want to be one of those companies we mentioned earlier with rapidly decaying email rates, so it’s important to focus not just on keeping your clients happy, but also your employees.
The best part is, if you’re collecting external and internal data effectively, you can compare your performance to your competition’s and identify possible areas for improvement.
Maybe your product has more desirable features than theirs, but they’re more effectively communicating with your shared target audiences. You can analyze what they’re doing differently and adapt to overcome that challenge.
The moral of the story
At the end of the day, there are multiple approaches to data collection and analysis, but it boils down to this: data is integral to growth. Whether you’re analyzing your competitors, yourself, or both, you need to know how to be as competitive as possible in an ever-changing environment.
Plus, we just happen to know where you can buy some great data — everymarketmedia.com — oh no! I dropped this link here. So sorry about that, you can just ignore it… or click on it, whatever. In the meantime, tune in to the Corporate Data Show for more hot tips, and read our other blogs for more in-depth breakdowns.