5 Major Reasons for Outsourcing Data Analytics of Your Start-Up

Starting a business is difficult as it is. While you’re trying to scale and jumpstart your start-up, the looming question hovers over your head: what should you do with all this data?  

Regardless of the industry you’re in, you must have endless excel sheets and tremendous amounts of data piling up, and that pile isn’t going to get smaller. Instead, that pile will get dauntingly large enough that it will be hard to get out of.  

While you try to make the most sense of it, there is one solution you should immediately take upon: outsourcing your data analytics. In this blog, we uncover 5 reasons why you should outsource data analytics for your start-up. By outsourcing analytics as a service, you won’t have to force your team to wear multiple hats and burn themselves out while trying to measure your start-up’s success with metrics.  

What is Outsourcing? 

Think of outsourcing as a magic wand that lets you take care of your business needs the exact way you want it to, without being burdened by it. If you feel outsourcing data analytics isn’t right at this point in time for your start-up, you need to think again. Outsourcing is done precisely at the stage when the start-up can’t afford the resources required for crucial tasks without a proper team. 

This isn’t a decision that should be taken lightly. Outsourcing can be daunting. But you must start asking the right questions openly. Think about the possibilities and weigh in on the prospects of outsourcing. We’re here to help you do exactly that. Let’s walk through some of the primary benefits you’ll receive should you move towards getting data analytics done by an external party or entity. 

The Benefits You Get By Outsourcing Data Analytics 

1. You Get A Technical Team That Makes Analytics Efficient  

Anything that isn’t directly related to your business is a task that doesn’t add value to your company. For a start-up to grow, it needs to hyper-focus on its product and how to add value to it. Rather than dividing your focus into tasks that will take your attention away from your company, you should outsource them.  

Outsourcing data analytics frees you from managing the technical complexities of your business operations. By outsourcing business analytics services, your company gains access to advanced big data analytics tools. 

Outsourcing services not only help businesses quickly gain data analytics skills but also enables the creation of a scalable ecosystem that might be difficult or impossible to achieve with in-house capabilities. 

Achieving effective data analytics often requires scalability and complexity that may be challenging to develop in-house. A professional data analytics partner brings analytical assets such as frameworks and accelerators, allowing for rapid scaling of data analytics processes. Outsourcing these functions also facilitates a quicker path to analytics maturity for a business. Your company needs all its resources aligned to improve your product or service. Anything which is ‘non-core’ will lag and pretty much affect your company’s performance.  

2. Outsourcing Analytics Lowers Your Costs 

The most important thing to a bootstrapped startup is budget constraints. Not necessarily just a bootstrapped one, but even those who have raised funding since burning cash have proved to be catastrophic for startups.  

To answer the question, outsourcing isn’t cost-heavy. Instead, it’s ‘cost-effective.’ The only alternative you have is to hire resources to do the same job which data analytics outsourcing companies could do for you. The global data analytics outsourcing market reached a value of $11.3 billion in 2023. According to IMARC Group, the market is projected to grow at a compound annual growth rate (CAGR) of 27.8% from 2024 to 2032, potentially reaching $109.1 billion by 2032. 

It doesn’t stop there; when you hire resources, you’ll need to purchase the technology they need to get the job done. It even goes further to provide them with the necessary training they might need from time to time to keep up with the ever-evolving world of big data. This is precisely why startups should outsource their data analytics work from the start. You don’t want your cash flow going towards something non-core; this is an example of cash burn, and you want to steer clear of it.  

3. Outsourcing Analytics Gives You A Competitive Advantage 

For those who might think that performing a limited amount of data analytics in-house is better than outsourcing it, they couldn’t be further from the truth. One thing that has been established in today’s world is that data is king. This ace card will give you that competitive advantage right from the start as it will pave the way for faster, more efficient, and more effective growth metrics that will become vital in working toward your north star. 

To stay ahead and disrupt various sectors, startups need to adopt the latest technologies. By outsourcing their IT services to specialist providers, startups can tap into a diverse talent pool skilled in cutting-edge technologies like artificial intelligence, machine learning, blockchain, and the Internet of Things. These experts can help integrate advanced solutions into their products or services quickly, giving them a competitive edge in the market. 

4. You Get Expert Advice From Professionals 

Data analytics is a complex field, and building the perfect in-house team can take years. Instead, consider partnering with dedicated industry experts who are eager to develop effective data analysis strategies for you. This way, you can be confident that your data and business intelligence are in capable hands. 

Some of the areas where a data analytics company works gives a holistic idea of how research-oriented they are include: 

• Website & Product Analytics: Analyzing the performance and usability of a website or product to identify areas for improvement and optimization. 
• Natural Language Processing: Using algorithms and computational techniques to process, analyze, and understand human language in a natural and automated way. 
• Sentiment Analysis: Identifying and extracting subjective information from text data, such as opinions, attitudes, and emotions, to understand the sentiment expressed by a person or group. 
• Marketing Analytics: Collecting, analyzing, and interpreting data from various marketing channels and campaigns to measure the effectiveness and ROI of marketing efforts. 
• Consumer Analytics: Using data and insights to understand consumer behavior, preferences, and needs to develop effective marketing strategies and drive business growth. 
• Customer Segmentation Analysis: Dividing customers into distinct groups based on shared characteristics or behaviors to tailor marketing efforts and improve customer retention and satisfaction. 

You must think realistically if you’re considering getting your IT guys to get these done. These are just a few of the key services a data analytics firm offers you. Each of these analytics will offer you insights into how to run your business and your way forward. But most of all, it helps you save time in your experimentation with tests and trials. It’s a fast-paced world today, and no one has time to spare. The more data-driven your decision-making is, the more effective your growth will be.  

5. Outsourcing Analytics Increases Productivity 

When you outsource your data analytics, you’ll have a team of experts working entirely on your data. This will ensure timely reports and analytic metrics to enhance your company’s overall performance. Individual teams, e.g., sales & marketing, will benefit largely from this as they won’t have to deal with data silos that cost a lot of time and money. 

While they focus on implementing data-driven decisions, they’ll constantly get reports from the firm that will show their progress, trends, and forecasts through which they can better drive their campaigns and sales. In his study, Outsourcing and Firm Performance: A Meta-Analysis, Markus P. Becker found that outsourcing enhances a firm’s performance. This paper used a meta-analytic approach to investigate the relationship between outsourcing and performance measures.  

Further, the reports generated for you will be easy to understand as the company will utilize its data visualization software to make reports. You can further use these to drive your KPIs and even present them to your investors.  

The Bottom Line 

Outsourcing is the best thing you can do for your company when done carefully and right. It makes more sense for a start-up and even more when it comes to data. An excellent data analytics firm will offer you services that will be a game changer and give you that market advantage to skyrocket your growth and achieve your north star metric faster than you thought you could. 

If you’re in search of a vendor with the right technologies and framework to make your data analytics efforts a breeze, fill out the form below and let’s connect.