It’s Time To Start Using Third Party Data
Looking to learn how? We investigate a few factors you should be monitoring.
A while back I challenged you to “[i]nsist on including external data in all your analysis…” In my travels (physical and through cyberspace) I received lots of positive feedback and agreement on this notion. However in the same travels, I continue to encounter many organizations who are not using external or third party data in their analysis.
Frankly there are few excuses from a technological and data access standpoint. The analysis itself can be performed on free software such as Qlik Sense Desktop, Qlik Sense Cloud or even a spreadsheet program included on virtually every business computer. Basic third party data is readily available and free in many cases either through a data service, such as Qlik DataMarket, or by simply searching the web. So what is the problem? Why doesn’t everyone include third party data in their analysis? I believe the problem is not knowing where to start. So let’s solve that issue right here.
Start Simple
Try starting simple, maybe even start by proving out something that ‘everyone knows’, such as the effects of rain on retail sales performance. This exercise will likely just reinforce existing knowledge but it will also build a foundation for trusting the analysis using third party data. On the other hand, if you are unable to prove out a ‘known fact’ then you will discover something new. To help you start simple, I’ve listed out five ideas where virtually any business could start using external data as a jumping off point.
Average Daily/Monthly Temperature
- Do your sales, margins, or other key metrics follow temperature trends?
- Is there a ‘key’ temperature that cause changes (e.g. dramatic decrease above a specific temperature)?
Total Daily/Monthly Precipitation
- Do sales, margins, or other key metric change on rainy days?
- Does the number of consecutive rainy days matter?
Per Capita GDP by region
- Does your business match areas with high GDP per capita? The first thing that come to mind is to compare GDP to sales however other metrics such as location would be just as valid.
Inflation
- Are your sales, growth, expansion, facilities etc. keeping pace with inflation?
Population of Target Demographic
- How do your sales, margins, or other key metrics vary by population?
- Using total population is an easy way to start, then refine by specific demographics.
All of these simple places to start require simplification and assumptions so any conclusion reached would only be preliminary. However by starting simple, you can begin a journey into unlocking insights in your internal data that can only be found by including third party data. All of the above jumping off points can be done using one of Qlik’s free products (Qlik Sense Desktop or Qlik Sense Cloud) and the free data in Qlik DataMarket so there are no excuses. Try including third party data in your analysis today, start with something simple!