Stop Confusing Predictive and Prescriptive Analytics
Technology can be confusing. Often, people find themselves using tech terms interchangeably when, in fact, there are very clear differences between them. A perfect example of this is the term “analytics.”
For B2B sales leaders in particular, the generic use of the term sales analytics can be a source of frustration. While you’re researching the different sales enablement providers, you’ll probably see many platforms touting analytics as one of their main features. But all analytics are not equal, and some claims of predictive or prescriptive analytics don’t hold up when you look at what’s actually being offered.
So let’s set the record straight.
We’ll start with some basics. There are three main types of analytics: descriptive, predictive, and prescriptive.
Defining Descriptive Analytics
Descriptive analytics is often considered the base level of what is possible with analytics. The analytics engine compiles the data, processes it, and describes to you what happened. An example of this might be a report showing open and click-through rates for a sales email blast. It’s still useful, since it gives you a holistic view of data, but it’s also very surface-level.
Defining Predictive Analytics
The next level of analytics is predictive. These analytics are used to predict what is likely to happen in the future based on past data. Predictive analytics are often used for better sales forecasting. Based on past sales performance, the engine can predict how the business will fare for the next quarter. The accuracy of predictive analytics is dependent on how strong your analytics engine is (e.g. how many variables the engine uses to predict future events, as well as how much data the engine has available for use).
Defining Prescriptive Analytics
Prescriptive goes one step beyond predictive to identify and suggest the best action, given a certain data set. This can be incredibly beneficial for B2B sales teams, since prescriptive analytics can be used to guide sales reps in the best actions, content, and messaging to use with leads for each unique sales situation.
SEE ALSO: Are Analytics the Future of B2B Sales?
Which Type of Analytics is Most Valuable?
Because the different types of analytics are often presented in a tier, with descriptive at the bottom and prescriptive at the top, it’s easy to believe that prescriptive analytics offer the most value. Based on this belief, your business might prioritize prescriptive analytics instead of investing in the other types.
That’s the wrong way to look at it. Instead, each type of analytics has value within B2B sales. Having analytics that help to predict the future is great, but it’s also useful to be able to identify what’s happening in the present. Don’t look at analytics within a vacuum, but instead try to imagine how they can help at every stage of the sales process.
How to Tell Which Type of Analytics is Being Offered
You’re not likely to find in-depth descriptions of each company’s analytics engine on their website or product brochures, but there are some tell-tale signs that the analytics are a certain type.
Look for Marketing Wording:
One of the most common types of analytics you’ll find mentioned is content analytics. When the only reference to analytics is to a very specific area of sales, it’s likely that the sales enablement platform isn’t based on a robust analytics engine. Instead, these analytics will be mostly descriptive (open rates, time each page is viewed, etc.). A more advanced platform will include predictive and prescriptive analytics, such as which content is likely to get the highest open rates and which presentation to send for a specific sales situation, but generally speaking, if the platform is capable of that level of detail, you’ll see the technology used in other parts of the sales process, such as coaching or sales forecasting.
Ask the Sales Rep:
If you’ve read this article, you’ll have a pretty solid foundation of the different aspects of analytics, so put your sales rep to the test. Ask them about the analytics engine running their platform. If the rep can’t tell you what type of analytics are offered or how they can be used within your organization, then the references to analytics are probably marketing fluff.
See a Demo:
The best way to know for certain is to see the analytics in action. If, during the demo, all you see are basic reports about actions by the sales or marketing team, you’re looking at a descriptive analytics solution. If the platform is able to offer predictions about what is likely to happen in the future (such as sales forecasts that seem to actually be based on real data or the likelihood that a particular opportunity will lead to a sale) or specific actions that your sales team should do within a given situation, then you’ve got a solid solution. Don’t rely on PowerPoint claims—ask to see the actual software in use.
Getting Started with Sales Analytics
A solid analytics strategy is not as simple as snapping your fingers. It requires the right data (and let’s face it: how many businesses have completely accurate data within CRM?) and the right platform to put that data to use.
The important thing is that you find an analytics engine that can be customized to meet the needs of your company. To find out how best to achieve that goal, give us a call at 1-800-771-6011 to discuss the specifics of your sales process. You can also click here to schedule a quick online demo of our sales analytics engine.