Guest column

Houston expert: How to use the power of data and analytics to inform ​small businesses​

Startups and small businesses are accumulating data daily — here's how to use that to your advantage. Photo via Getty Images

Starting a business in a digital era brings entrepreneurs unprecedented advantages with technology and tools designed to optimize a business' operation. Whether it is a B2C or B2B, business owners can gather almost any data and metrics to improve their performance.

Being able to interpret data and making data-driven decisions becomes the key to the success of a business. It is not just a privilege for big companies anymore. Small businesses need it more than ever to make sustainable growth in the digital era.

The challenge? There are countless analytic tools and resources available that can generate data, but you need people who can extract insights from the massive amount of data.

Hire a data science team vs. outsourcing

Many companies go to campus recruitment and scout bright data science talent who also identify with their business value. Hiring people with data science and analytic skills is optimal, but for startups that are not ready to hire an in-house team or have a short-term question, outsourcing is a better option.

Data science consulting

Many online resources can help you extract data, but you are probably wondering: where do I begin? Which tool should I use? Which exact metric should I track?

The Rice University's Data Science Consulting Clinic provides free, open to the public assistance to help clients with all of those questions. It can be for various business sectors, such as research and product development, cost predictions, analytic tools, acquisition decisions, and talent management.

Here are some of the data science aspects we specialize in:

Research & Development - Obtain data to inform a decision on what products to develop.
Data analysis of who your customers are, what they are interested in, and what product to develop is crucial for B2C and B2B. A recent example of how Rice's Data Science Consulting Clinic is making a difference is a client needed assistance with market research to help inform a startup on what kind of product they should create next. The client was able to use the data resources suggested by the student and faculty consultants to gauge consumer sentiment and examples of successful products. With the data collected, the client was able to identify the features that drive customers to purchase similar products.

Cost Predictions - A case study for an energy company
Businesses need to make crucial decisions to achieve business intelligence. CEOs and managers need to base their decisions on predictions and analysis. Another client from the Data Science Consulting Clinic was interested in predicting cost and analysis of the factors contributing to the most expense for the coming year. The client's main problem was to transform the data into a statistical model that could predict the cost. With the prediction model suggested by the student consultants, the client was able to reduce the cost by controlling factors that were likely to cause higher costs.

Acquisition Decision Making for Business Professionals
Clients from the Rice MBA program were interested in investigating the causes and effects of private equity (PE) acquisition. Specifically, the clients wanted to analyze the difference in practice habits before and after acquisitions. As a result of the consultation, the clients were able to determine what factors influenced the PE's decision to acquire new equity.

Longer term projects

It would be helpful to have a dedicated data science team who can work over a semester or year long to find the solution.

Higher education has placed a prominent focus on data science programs, especially capstone projects that provide students with real-world experience. As a business owner, you might not even think about working with an esteemed university to help you with data challenges.

The Center for Transforming Data to Knowledge, informally known as the D2K Lab at Rice University, is founded based on the mission to seek real-world data challenges for passionate data science students. Student teams have worked on over 50 sponsored data science projects with partners from a wide variety of businesses, organizations, and community partners.

Advance data science and security

The perk of working with Rice University is that it provides the most advanced data science research tools and an interdisciplinary pool of student and faculty talent who are passionate about data science. Working with Rice University also guarantees a strong data security system and a comprehensive confidentiality agreement.

  • A cloud-based financial company sponsored a series of capstone projects on applying deep learning to reduce documentation errors and increase efficiency for businesses.
  • A fintech company sponsored multiple capstone projects on building statistical models to predict costs.
  • In the tech-med industry, the D2K Lab has partnered with the Medical Informational Corps, and researchers from Texas Children's Hospital and Baylor College of Medicine to build algorithms to predict cardiac events.

The future of data-driven decision making

The digital era has become the norm for all businesses (large or small), and there's no way to avoid the power of transforming data into actionable insights. So start gathering data even before you build out a business and incorporate the culture of data-driven decision making into every sector of your business.

------

Shanna Jin is the communications and marketing specialist of the Data to Knowledge Lab at Rice University.

Trending News

Building Houston

 
 

Cheers Health has expanded its product line as it evolves as a wellness-focused brand. Photo courtesy of Cheers

Houston-based startup Cheers first got a wave of brand devotees after it was passed over by investors on Shark Tank in 2018. In the years since, Cheers secured an impressive investment, launched new products, and became a staple hangover cure for customers. When the COVID-19 pandemic disrupted businesses, the company rose to the occasion and experienced its first profitable year as drinking and wellness habits changed across America.

Cheers initially started its company under the name Thrive+ with a hangover-friendly pill that promised to minimize the not-so-fun side effects that come after a night out. The capsules support the liver by replacing lost vitamins, reduce GABAa rebound and lower the alcohol-induced acetaldehyde toxicity levels in the body. The company's legacy product complemented social calendars and nights on the town, providing next day relief.

With COVID-19 lockdowns and social distancing measures, the days of pub crawls and social events were numbered. Cheers founder Brooks Powell saw the massive behavior change in people consuming alcohol, and leaned into his vision of becoming more than just a hangover cure but an "alcohol-related health company," he says.

When the pandemic first hit, Powell and his team noticed an immediate dip in sales — a relatable story for businesses in the grips of COVID-19.

"There is a three day period where we went from having the best month in company history to the worst month in company history, over a 72 hour stretch," he remarks.

He soon called an emergency board meeting and rattled off worst-case "doomsday" scenarios, he says.

"Thankfully, we never had to do any of these strategies because, ultimately, the team was able to rally around the new positioning for the brand which was far more focused on alcohol-related health," he says.

"We found that a lot less people were getting hangovers during 2020, because generally when you binge drink, you tend to binge drink with other people," he explains.

He noticed that health became an important focus for people, some who began to drink less due to the lack of social gatherings. On the contrary, some consumers began to drink more to fill the idle time.

According to a JAMA Network report, there was a 54 percent increase in national sales of alcohol for the week stay-at-home orders began last March, as compared to the year prior.

"All of a sudden, you have all of these people who probably aren't binge drinking but they're just frequently consuming alcohol. Their drinks per week are shooting up, and they're worried about liver health," explains Powell.

Outside of day-after support, Cheers leaned into its long-term health products to help drinkers consume alcohol in a healthier way. Cheers Restore, a dissolvable powder consumers can mix into their water, rehydrates the body by optimizing sodium and glucose molecules.

For continued support, Cheers Protect is a daily supplement designed to increase glutathione — an antioxidant that plays a key role in liver detoxification — and support overall liver health. Cheers Protect, which was launched in 2019, became a focus for the company as they pivoted its brand strategy and marketing to accommodate consumer behavior.

"The Cheers brand is just trying to reflect the mission statement, which is bringing people together through promoting fun, responsible and health-conscious alcohol consumption," says Powell. "It fits with our vision statement, which is a world where everyone can enjoy alcohol throughout a long, healthy and happy lifetime,."

At the close of 2020, Cheers had generated $10.4 million in revenue and over $1.7m in profit — its first profitable year since launch.

During the brand's mission to stay afloat during the pandemic, the Cheers team was also laying the groundwork for its entry into the retail space. When Powell launched the company during his junior year at Princeton University, bringing Cheers to brick-and-mortar stores had always been a goal. He envisioned liquor and grocery stores where Cheers was sold next to alcohol as a complementary item. "It's like getting sunscreen before going to the beach, they kind of go hand in hand," he says.

"When we spoke with retailers, specifically bars and liquor stores, what we learned is that a lot of these places were hesitant to put pills near alcohol," he says. Wanting an attractive and accessible mode of alcohol-support, the Cheers team created the Cheers Restore beverage.

Utilizing the technology Cheers developed with Princeton University researchers, the Cheers Restore beverage incorporates the benefits of the pill in a liquid, sugar-free form. The company states that its in-vivo study found that the drink is up to 19 times more bioavailable than pure dihydromyricetin (DHM), a Japanese raisin tree extract found in Cheers products and other hangover-related cures.

"What we figured out is that if you combine DHM — our main ingredient — with something called capric acid, which is an extract from coconut oil, the bioavailability shoots way up," says Powell. He notes the unique taste profile and the "creaminess" capric acid provides. "Now you have this lightly carbonated, zero-sugar, lemon sherbert, essentially liver support, hangover beverage that tastes great in 12 ounces and can mix with alcohol," he explains.

The Cheers Restore beverage is already hitting the Houston-area, where its found a home on menus at Present Company. The company has also run promotions with Houston hangouts like Memorial Trail Ice House, Drift, and The Powder Keg.

Currently, the beverage is only available in retail capacity and cannot be ordered on the Cheers website. As Powell focuses on expanding Cheers Restore beverage presence in the region, he welcomes the idea of expanding nationally in the future to come. While eager customers await the drink's national availability, they can actively invest in Cheers through the company's recently-launched online public offering.

Though repivoting a company and launching a new product is exciting, the process did not come without its caveats and stressors. While Cheers profited as a business in 2020, the staff and its founder weren't immune to the struggles of COVID-19.

"I think 2020 was the first year that it really became real for me that Cheers is far more than just some sort of alcohol-related health brand and its products," says Powell. "Cheers is really its employees and everything that goes into being a successful, durable company that people essentially bet their careers on and their family's well-being on and so forth," he continues.

"It really does weigh on you in a different way that it's never weighed on you before," says Powell, describing the stress of the pandemic. The experience was "enlightening," he says, and he wants others to know it's not embarrassing to need help.

"There is no lack of great leaders out there that at long periods of their life they needed help in some way," he says. "For me that was 2020 and being in the grinder and feeling the stress of the unknown and all of that, but it could happen to anyone," he continues.

Trending News