Take any business model from anywhere in the world and you can sum it up in one straightforward equation: information + strategy = profit. The aim of every business is to figure out what their client’s problems are and then use the information they have to form a solution.
But in a world that is practically dripping with information, figuring out what is relevant and where you can benefit is surprisingly difficult. Though more information can be useful, information overload can damage your company’s agenda and vision. It’s not as simple as collecting as much information as possible; you have to know what you are doing with that information to make it work.
To maximize profit, you have to optimize your efficiency. This means that you need to be able to retain your high-quality results while speeding the whole process up. And this is where information is key.
Let’s say you have a fleet of cars and you want to ensure that each car is spending as little time getting from location to location in order to maximize the time spent actually working on site. You could easily use telematics to track your fleet while they are on the road but you could also use the information you gather to work out the most efficient route for each car.
When you have a tight budget, you need to ensure that every penny you spend goes to moving your business forward. But this doesn’t mean that you should stop experimenting. In fact, you should be experimenting all the time to make sure that you can refine every process to it’s most efficient iteration.
The most obvious area ripe for refinement is social advertising. Here you are given a lot of information to deal with from the number of clicks each post gets to the kind of audience it appealed to. Though it might be tempting to broaden each post to appeal to the maximum number of people, in this case, the best information will lead you to a much narrower audience. The smaller your audience is, the more likely you are to get conversions from that target group. A bigger audience is a waste of money because you are paying for people who aren’t really interested to see your brand. It’s a big difference and worth serious thought.
Whenever you gain any information, you should always approach it critically. This means that instead of taking any information at face value, you should explore where it has come from, what has motivated the information and how it might be relevant to you. The smartest businesses are the ones who ask even the most basic questions and take nothing for granted.
Learning to use information well is a long process and as a start-up business, you shouldn’t be too hard on yourself if you do waste time on things that don’t work out well or as you imagined. The key is to look at every experience as a chance to learn and figure out what to do next.