Report: Adoption of Embedded Analytics Growing

by   |   July 27, 2016 5:30 am   |   0 Comments

Mark Lockwood, Director, Product Marketing, Logi Analytics

Mark Lockwood, Director, Product Marketing, Logi Analytics

We rely on technology to help us make virtually every decision. Look at popular consumer applications like Amazon, Netflix, and Facebook: They all are centered on data. Amazon offers reviews to help us select the best product. Netflix uses our viewing history to recommend shows. Facebook adds content to our newsfeeds that it thinks we’ll enjoy.

Naturally, people now have come to crave a similarly seamless, data-centric user experience within their business applications. This “consumerization of technology” means people expect to be able to access the data they need when they need it, in the applications they are already using, to make business decisions on a daily basis. And they don’t want to have to go through time-consuming training to understand these new analytics tools. Can you imagine needing a training course to learn how to use Amazon?

There’s no denying that the analytics landscape is shifting, and new needs are driving major transformations. Chief among these is organizations’ need for self-service tools that will enable users with easy access to business data.

But even as organizations expect employees to use these tools to make data-driven decisions, and as users get the access to data they demand, many teams are still struggling with adoption. This may be due to one key difference between consumer applications and most business applications: where the analytics reside.

When you are looking at a product on Amazon, the reviews are embedded right on the page. When you check your Facebook app, your newsfeed is the first thing you see. Yet when you want to analyze business data, it’s often in a separate application all together. It’s not a seamless experience.

Organizations can ensure their users will actually use the tools they provide to make decisions by making the experience more like the consumer experience to which they have become accustomed – with embedded analytics.

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Embedded analytics is the integration of data analytics capabilities within business applications. Embedded analytics helps users work smarter by incorporating relevant data within the applications people use every day, creating a more efficient user experience and allowing users to quickly solve high-value business problems.

This is in contrast to traditional business intelligence, or BI, which focuses on extracting insight from data within the silo of an analytics tool. Embedded analytics strives to bring together insight and action into the same context by integrating analytics deep within business applications and workflows.

Users Expect BI Inside Applications

Every year, Logi Analytics takes the pulse of the analytics industry with the State of Embedded Analytics survey. Respondents include commercial independent software vendors (ISVs) and SaaS providers as well as providers of non-commercial, IT-managed applications used by internal staff and partners.

Year over year, the results have revealed that most users now expect business intelligence to be embedded inside their business applications. In fact, according to the 2016 State of Embedded Analytics Report, a whopping 94 percent of ISVs and SaaS providers, and 80 percent of non-commercial application providers, say embedded analytics is important to their users.

What’s more, embedding analytics increases user adoption. Application providers say 43 percent of their users leverage embedded analytics on a regular basis. That’s double the adoption rate (22 percent) of traditional analytics tools, and that number is expected to jump to 52 percent within two years.

Everyone Is Seeing the Benefits

The benefits of embedded analytics always have been obvious for commercial software and SaaS providers, and key among them is its ability to increase revenue. In fact, respondents said they charge an additional 24 percent on top of their core offerings for embedded analytics; that’s up from 15 percent just two years ago.

This year’s report also highlights the growing importance of embedded BI for non-commercial application providers. While these providers may not see direct revenue from BI like their commercial counterparts, they too are seeing huge benefits. In fact, this year’s respondents say their internal IT teams have experienced huge boosts in user adoption thanks to the superior user experience of their embedded applications.

On top of that, the 2016 report demonstrates the importance of embedded analytics to groups outside of application developers and product managers. For the first time, the results show executive management as tied with product management as the two groups most likely to drive embedded analytics initiatives at their companies. As executives look to increase revenue, bring products to market faster, and stay competitive, embedded analytics platforms can deliver much-needed functionality while reducing the developer resources required.

Another key trend this year is an increase in adoption of advanced and predictive analytics embedded inside of applications. Previously, these sophisticated capabilities have been reserved for skilled data scientists. Now, as more organizations require employees to report on metrics, all types of analytics are becoming accessible to a broader user base.

No Signs of Slowing Down

From an implementation and user interface standpoint, businesses must continue to embed analytics within their applications. Businesses that don’t will keep struggling to get the majority of users to adopt analytics tools. At the end of the day, all companies are becoming software companies, and all software applications need to become analytics applications.

Still, too many people today think of embedded analytics as simply a reports module within business applications. But embedded analytics is much more than that. It means embedding analytics deeper within the application experience so users can view business data and take action based on that information, all within the same workflow. It means creating a better experience so users can become more efficient in the way they work every day.

As more organizations require their employees to report on metrics, it’s more important than ever to provide analytics within the applications people already use. As shown by the latest survey findings, it’s clear that embedded analytics is becoming the number-one way for organizations to become more data-driven.

Mark Lockwood is the director of product marketing at Logi Analytics, where he is responsible for market development, product strategy, sales enablement, and thought leadership. Prior to joining Logi, Mark was a Lead Strategy Associate at the management consulting firm Booz & Company, where he helped create the firm’s first big data service offering.

Mark earned a dual degree in Industrial Engineering and Economics from Northwestern University and holds an MBA from Harvard Business School.

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