In today’s rapidly changing environment, data is essential for success. To enhance application engagement and improve customer satisfaction, product leaders and developers must create exceptional user experiences. Many organizations use traditional business intelligence to analyze crucial data and make better-informed decisions.
Traditional BI is valuable but limited as it doesn’t provide insights within existing applications, causing workflow disruptions. Additionally, it fails to monetize data by integrating analytical experiences directly into the applications and services used by customers and end users.
Modern businesses and product leaders are adopting embedded analytics to offer rich analytical experiences within their applications. There are many reasons to use an interactive embedded analytics platform or adopt an embedded analytics software. Before diving deep, let’s first define embedded analytics.
What is Embedded Analytics?
Embedded Analytics integrates big data analytics and visualization directly into your software application or platform. Instead of using a separate analytics tool, it provides insights and visualizations within the software you’re already using, helping you work more smartly and efficiently.
In simple words, it’s like having an all-in-one, built-in, real-time analytics tool in your application that gives you relevant data insights into your business. Embedding analytics helps organizations deliver a data-driven experience by integrating reports, dashboards, models, data visualization tools, and other forms of business intelligence into one interface. This enhanced interface gives superpowers to businesses and individuals. They can quickly ask questions about their data and discover meaningful insights without leaving the interface they are accustomed to using.
The Value of Embedded Analytics
Embedded analytics make everything simpler. Rather than requiring application users to exit the familiar interface of their daily tools, the integration of business intelligence (BI) directly within operational or custom applications enhances user adoption. This transformative approach turns these applications into true game changers.
One of the significant advantages of embedded analytics is the elimination of the need for writing code to create dashboards. Unlike many product companies that invest substantial effort in developing both front-end and back-end code for dashboards, utilizing BI tools offers an advantageous, no-code solution.
Embedded analytics strategically places data and insights precisely where users need them the most: seamlessly integrated into their daily workflow. According to a study by Sisense: “If a product’s asking price is $20,000, embedded analytics can increase premium pricing by 25%, in an example of 1,000 customers, which translates to an additional $5 million in revenue.”
The Benefits of Embedded Analytics If You’re a Product Company
In product companies, analytics is no longer an optional addition but a component essential for success. Product companies increasingly depend on data as the cornerstone for informed decision-making, operational optimization, and enriched customer experience.
Take the example of Uber, a company that revolutionized its core ride-hailing service. By employing intricate data-driven algorithms, Uber optimizes its services, ensuring efficient driver-rider matching through predictive models, supply optimization, and real-time dynamic pricing.
Within the dynamic landscape of product companies, the role of analytics has evolved from a mere optional addition to an essential component of triumph. Progressive product companies recognize that the insights derived from data analysis serve as the cornerstone for informed decision-making, operational optimization, and enriched customer experiences. Enterprises integrating analytics into the very core of their offerings can empower users to effortlessly access a treasure trove of data-driven insights, all within the confines of their applications.
1. Streamlining Analytics Integration
Embedded analytics offers a seamless way to integrate analytics capabilities by utilizing business intelligence (BI) tools. These tools, whether licensed or open source, allow the creation of interactive dashboards and reports that can be seamlessly embedded within the product interface. This integration simplifies the process and eliminates the need for extensive coding to develop analytics features from scratch.
Embedded analytics provides a strategic advantage by integrating data analytics tools directly into products, enhancing user experience and decision-making without the need for complex coding.
2. Centralizing Data and Insights
In many product companies, the same Operational Transactional Processing (OLTP) database serves both the product’s core functions and the analytics features. This arrangement can lead to performance bottlenecks and hinder the scalability of the analytics infrastructure. To address this, embedded analytics suggests a separation between the Online Analytical Processing (OLAP) database and the OLTP database.
By establishing a dedicated OLAP database, companies can ensure smooth and efficient data retrieval for analytics reports and dashboards. This enhances the user experience by providing swift access to insights, through operational analytics, and relieves the operational database from the added load of analytical queries.
3. Efficiency in Development and Adaptation
One of the most significant advantages of adopting embedded analytics lies in the expedited development process. Unlike traditional coding approaches, where each modification to analytical features requires substantial coding efforts, embedded analytics enables swift updates.
Moreover, adding new key performance indicators (KPIs) or modifying existing dashboards and reports can be done with minimal coding or even none, depending on the complexity.
This efficiency in development has a cascading effect on the product’s agility. It empowers product teams to rapidly respond to user demands, evolving business requirements, and emerging market trends. (If you’re a product team and you are looking to learn how to use data to make better product experiences, click here to learn more.) Consequently, the product can maintain a competitive edge by staying ahead of the curve in delivering insightful analytics to users.
4. Cost-Effectiveness and Versatility
While licensed BI tools can introduce costs to the company’s budget, open-source alternatives like Metabase provide cost-effective options for implementing embedded analytics. This affordability aligns well with the cost-conscious strategies of many product companies, allowing them to allocate resources more strategically.
5. Data Confidentiality
A major benefit of embedded analytics is that it alleviates businesses’ concerns about sharing data with third parties for privacy reasons. Some companies prioritize creating interactive dashboards but overlook data security and privacy. When embedding analytics into your apps, it’s crucial to avoid this mistake.
With embedded analytics, your data remains within the provider’s secure environment, so there’s no need to worry about data leaving your control. Additionally, data can be governed at the user level to prevent risks and security breaches.
According to a study by Sisense: “If producing manual ad hoc reports takes two weeks (80 hours)/month and costs $100 an hour, analytics could reduce the time to eight hours/month, saving 72 hours of labor time/month or $86,400 a year.”
Moreover, the versatility of embedded analytics extends to its compatibility with tools like cube.dev. These tools facilitate the construction of robust analytics stacks, enabling companies to leverage advanced analytics capabilities without the complexities associated with custom coding.
The Applications of Embedded Analytics in a Business
You might be wondering,” All of this sounds great, but where and how do I use embedded analytics exactly?”
The application of embedded analytics is widespread, and it simmers down to three places: internal data transformation, SaaS empowered embedding, and product websites.
1. Internal Tools
Embedded analytics can greatly serve your internal operations— such as your CRM, operations, HR, IT, Finance, etc. Teams employing these will gain a more insightful approach to interacting with data from your business. This distributes data insights across the organization and can be a great step toward a data-driven culture fostering data-based decision-making.
An example of embedded analytics is CRM software that displays visualizations of sales trends and customer behavior within its interface, helping sales teams make informed decisions.
2. SaaS Platforms
Cloud-based SaaS platforms provide an extensive array of tools and services tailored to meet their customers’ business needs. Elevating this offering, embedding analytics emerges as a potent approach to further empower B2B customers, enhancing the platform’s value proposition and solidifying its role as a comprehensive solution.
This is precisely where the versatility of BI tools shines. Instead of resorting to intricate coding, the creation of dashboards and reports becomes a streamlined process via BI tools. These dashboards can then be seamlessly integrated into the product, seamlessly enhancing the user experience.
3. Product Websites
Product teams who deal with consumer-facing products or software can leverage embedded analytics into their software. With this, a user experience is created for the teams with drill-down analytics and data explorations.
Retail companies trying to run an inventory can find this very useful. They can keep up with growing customer demand and dive into each product to see how it performs. Armed with this data, retailers can enhance their performance by planning everything from supply chain optimization to marketing.
Did you know?: A recent survey by ThoughtSpot found that 55% of global respondents reported that they already offer embedded analytics in their products. The same survey found that 72% of respondents believe that embedded analytics will be essential for businesses in the future.
The Way Forward
Incorporating embedded analytics as a winning strategy within product companies can significantly elevate their performance and user experience. Companies can efficiently integrate analytics features using BI tools. This streamlined approach, coupled with the separation of OLAP and OLTP databases, ensures optimal performance and scalability.
As a company, Data Pilot specializes in providing analytics-as-a-service specifically for cases like product companies. By consolidating data from all relevant sources, Data Pilots’ embedded analytics services offer a complete 360-degree view of your operations, helping you make informed decisions with real-time insights and ease.