Episode 305: The True Power of Data Analysis in Business
In the 305th episode of Mail Right Show, Jonathan Denwood and Robert Newman brought Jack Tomkins, managing partner of Pineapple Consulting Firm in Charlotte, NC. Tomkins is a data and business analysis expert specializing in assisting small firms in making data-driven decisions through customized dashboards. He has been invited to the show to highlight the true power of business statistics and how individuals may use data to their advantage, which was previously undervalued by many in the corporate world.
What is data analytics?
In recent years, the increasing relevance of data analytics can be a significant asset in the property market if adequately utilized. The property market is enormous and complex, and the majority of its great potentials may be lost if the data created daily in the business is not productive.
In today’s information age, it’s evident that the property market, like many of its counterparts in other sectors such as consumer goods, sports analysis, political trends, medical research institutions, and the financial industry, can benefit enormously from the steady rise in the importance of data analytics. Data can help visualize the numerous facets of the real estate industry’s activity. This insight can assist real estate stakeholders in driving the industry’s growth.
For example, real estate investors can use data from reputable internet real estate organizations to inform their investment decisions. The data provided by such platforms can assist homeowners in estimating and forecasting the worth of their properties over a specified period.
In layman’s terms, Data Analytics arm buyers with data and knowledge about the homes in a particular community, its residents, market rates, and trends. These details assist buyers in mitigating investment risks while making sound decisions.
Data Analytics: The Future of CRE Professionals
As we frequently remark, there are two types of data: insufficient data and sound data. CRE databases are undergoing a significant transformation in terms of both quality and accessibility at the moment. Five or ten years ago, used data purely for transactional purposes, such as determining the value of a property. Investors analyzed a commercial property’s rent rolls and revenue streams, made an educated bet on the building’s value, and either purchased it or decided it wasn’t a suitable investment.
Today, investors may do a considerably more in-depth analysis of a property’s prospective return and risk by utilizing the wealth of data accessible. Knowing everything about a facility through flood maps, demographic studies, traffic counts, tenant and store counts, and EPA reports, among other sources, provides a potential buyer with an exact estimate of their ROI on day one. The ability to precisely quantify both the physical and human qualities of a property changes the game when it comes to analyzing its potential because it provides investors with actionable information.
To maintain the highest level of openness, CRE professionals should look beyond tax records and concentrate on critically validated and researched data points that will aid in their next decision.
Data Analytics: Proven more effective and cheaper than any other marketing strategies
Many agents have been selling homes for five, ten, fifteen, or twenty years through Zillow, direct mail, or other methods. And they are making the premise that their marketing is effective; yet, in this particular type of marketplace, such assumptions may be inaccurate. As a result, how do they validate it? How can they ensure that they are not incurring losses? How do they know if the marketing plan that worked previously is no longer working, and they are oblivious of it because they spent $12,000 more than they earned? Do they spend twenty or thirty hours perusing spreadsheets? Obviously, no. It is when a data analyst comes into play. Over ten years, these investors may spend $12,000 every year on the same marketing channel, totaling $120,000. That is a substantial sum of money. However, hiring a data analyst like Jack to study their past performance and how it compares to the current version will cost these investors a few thousand dollars but might very well save them tens, twenty, thirty, or forty thousand dollars in the long run. That is how much more productive and cost-effective having a data analyst is in a real estate business than not having one. It demonstrates the vital importance of data analysis. It is why it is the most recommended aspect of marketing, above all others.
Property-related firms must adapt to current technologies and trends or risk being left behind. Data analytics technologies are adopted across industries, and now is the ideal opportunity to position yourself ahead of the competition in an already competitive industry. As a result, businesses should pursue growth by making data-driven strategic decisions and discovering the previously unknown.