Knowledge

Data Aggregation: How It Benefits Businesses?

By 2025, more than 180 zettabytes of data will have been created and captured around the globe. With the influx of data in this digitized world, the process of data aggregation has become an essential tool for businesses. It’s a way to take large amounts of separate data from different sources and combine them into one collective body. Data aggregation can help companies better understand their operations — from cost savings to customer satisfaction— and gain insights about their customers, products, and services.

What is Data Aggregation?

Data aggregation is a process of gathering data from multiple sources and compiling, formatting, and processing the data further in a summarized form. It is used to analyze data statistically.

Data aggregation can include processes such as collecting data about a particular product based on age, profession, location(etc), collecting data from a company/competitor’s website to analyze their trends, and gathering image and product descriptions to be used on the company’s website. Once the information is collected, it is then converted into documents and reports and then sold to companies in a simplified manner. Different versions of the reports are available and there are unique reports that are prepared for every department and individual. These records can also be requested as per the individual’s preference.

Data aggregation also deals with the quality of the data being collected. By doing this, they ensure that all the analysis happens in real-time and the quality of data is not hindered during any stage of the aggregation procedure.

data aggregation

Why is it important?

In our technologically advanced world, data is constantly evolving, expanding, and becoming more convoluted with each actioned input and output. Data is one of the most valuable currencies of our time, but data without organization, segmentation, and understanding is essentially useless.
What makes data valuable is the extraction of insights that point to key trends, and results, and give a better understanding of the information at hand. A process in which data is searched, gathered, and presented in a summarized, report-based form, data aggregation helps organizations to achieve specific business objectives or conduct process/human analysis at almost any scale.

How do Data Aggregators work?

Data aggregators work by combining atomic data from multiple sources, processing the data for new insights, and presenting the aggregate data in a summary view. Furthermore, data aggregators usually provide the ability to track data lineage and trace back to the underlying atomic data that was aggregated.

  • Collection. First, data aggregation tools may extract data from multiple sources, storing it in large databases as atomic data. The data may be extracted from Internet of Things (IoT) sources, such as the following: social media communications; news headlines; personal data and browsing history from IoT devices; and call centers, podcasts, etc. (through speech recognition).
  • Processing. Once the data is extracted, it is processed. The data aggregator will identify the atomic data that is to be aggregated. The data aggregator may apply predictive analytics, artificial intelligence (AI), or machine learning algorithms to the collected data for new insights. The aggregator then applies the specified statistical functions to aggregate the data.
  • Presentation. Users can present the aggregated data in a summarized format that provides new data. The statistical results are comprehensive and high quality.

Data aggregation may be performed manually or through the use of data aggregators. However, data aggregation is often performed on a large-scale basis, which makes manual aggregation less feasible. Furthermore, manual aggregation risks accidental omission of crucial data sources and patterns.

3 benefits of Data Aggregation

If raw data is a puzzle piece, then aggregated data is the completed puzzle, providing you with the insights you need to steer your business in the right direction. As such, data aggregation benefits organizations in three important ways.

  • Helps decision-making and business performance

Data aggregation helps businesses measure the efficiency of their marketing campaigns, identify changes and patterns in customer behavior, and implement strategies for sales.

Instead of relying on siloed data for important decision-making, businesses can consider all of the relevant metrics before investing in new product development, new marketing channels, customer retention campaigns, etc.

For example, a business that wants to prioritize one social media platform for its marketing activities in the next quarter can consult the aggregated data from each platform. By comparing KPIs, the marketing team can select the one with the highest chance of success.

  • Democratizes access to high-quality data

Aggregating and hosting data in a single platform also improves access to accurate data. Instead of using spreadsheets or different apps to track data, which can create data silos, it’s all accessible in one dashboard.

According to a Forrester report, “managing data and sharing insights that drive actions across organizational silos” are the biggest challenges businesses face in meeting their sales and marketing goals. Data silos create confusion and arguments over whose data is correct, but these issues can be solved by aggregating data from all sources into a single platform.

  • Improves efficiency

Platforms that aggregate and present data in a summarized format also enable employees to self-serve information, which reduces your team’s reliance on the IT department to retrieve it. From sales to product development, every department can quickly retrieve data assets and be more efficient in their workflows.

data aggregation

Uses cases for Data Aggregation

Aggregated data can be applied successfully in several industries, such as:

  • Finance: Financial institutions aggregate data from various sources to assess the creditworthiness of their customers. For example, they use it to decide whether or not to grant a loan. Also, aggregated data is useful for studying and identifying stock market trends.
  • Healthcare: Medical facilities use data aggregated from health records, health tests, and lab results to make treatment decisions and improve care coordination.
  • Marketing: Businesses aggregate data collected from company websites and social media platforms to monitor mentions, hashtags, and engagement. This is how you can understand if a marketing campaign worked. Plus, sales and customer data are aggregated to make business decisions for upcoming marketing campaigns.
  • Application Monitoring: Software periodically collects and aggregates application and network data to monitor application performance, discover new bugs, and troubleshoot issues.
  • Big Data: Aggregating data makes it easier to analyze the data available globally and store it in a data warehouse for future use.

Final thoughts

Data aggregation is one of the most powerful methods of compiling data for statistical analysis. This process can help you extract data that provides valuable insights into the effectiveness of your products, services, or marketing campaigns. Depending on your objectives and the industry your organization is in, different reporting and polling periods may be chosen. However, automated data aggregation is generally considered to be more efficient than its manual counterpart. Data aggregation can ultimately impact nearly every significant aspect of your business operations. Therefore, it’s important to choose your data collection and aggregation methods wisely.

Knowledge

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