Data Operations: 6 Practical Data Analysis Models You Must Know!

For those who are new to data analysis, they often have such confusion and questions: Is data analysis difficult? If it's difficult, what's the difficulty? Why is it that sometimes I don’t know where to start when doing analysis and can only try to do everything at once?

In fact, even an old hand like me who has been immersed in the data analysis industry for more than ten years sometimes gets flustered when doing analysis. The fundamental reason is that I have not grasped the essence of data analysis. We use large amounts of data to analyze, explain and predict facts based on the data. You must first understand the purpose of your data analysis. Is it to describe event analysis? Or for prediction? Or is it normative analysis?

According to my experience, there is a good shortcut to mastering data analysis methods - applying analysis models . This is almost a panacea for novices. As long as you master the following analysis models, you can basically cope with all business analysis scenarios at work.

AARRR Model

The AARRR model is one of the most basic models for data analysis. The so-called AARRR refers to acquisition, activation, retention, monetization and dissemination.

Among them, acquisition refers to obtaining user leads. We can analyze the acquisition of SEO, SEM and other analytical websites;

Activation means increasing the user's activity level, mainly through promotions, content persuasion, etc. to make users the most valuable active users;

Retention means settling the active customers and assigning them to your own traffic pool, such as the common community UCG and O2O service retention methods. We can monitor the user churn of the application through indicators such as daily retention rate, weekly retention rate, and monthly retention rate, and take corresponding measures to encourage these users to continue using the application before they churn.

Monetization is actually about obtaining income, which we can analyze by monitoring indicators such as transaction rate;

Propagation is a unique analytical direction in the era of social networks. Only by achieving self-propagation and virality can one continuously expand one's user base.

5W2H Model

5W2H, namely why (Why), what (What), who (Who), when (When), where (Where), how (How), how much (How much), is mainly used for user behavior analysis, special analysis of business problems, marketing activities, etc.

This model is very useful. Let's take user purchasing behavior as an example:

Why: Why should users buy? What is the attraction of the product?

What: What did the user buy? In other words, what functions does the product provide?

Who: What group of users purchase the product? What are the characteristics of this group?

When: How often do users purchase?

Where: Where is the product most popular? Which platform to sell on?

How: How and through what methods and channels do users purchase?

How much: How much does it cost for users to purchase?

SWOT Model

SWOT analysis is also called situation analysis. S stands for strengths, W stands for weaknesses, O stands for opportunities, and T stands for threats or risks.

Among them, opportunities and threats are generally analyzed together. Threats refer to the challenges posed by an unfavorable development trend in the environment. If decisive strategic actions are not taken, this unfavorable trend will lead to the weakening of the company's competitive position. An opportunity is an attractive area for a company to act in, where it will have a competitive advantage.

The relative one is the strengths and weaknesses analysis, which is to make a detailed comparison between the company and its competitors in every link of the entire value chain, such as whether the product is novel, whether the manufacturing process is complicated, whether the sales channels are unobstructed, and whether the price is competitive.

The duration of a company's competitive advantage is mainly affected by three key factors:

How long does it take to build this advantage?

How big of an advantage can be gained?

How long will it take for competitors to respond forcefully?

Funnel Model

The funnel model is called a funnel because users (or traffic) enter from a certain functional point (which can be set according to business needs) and may complete the operation through the process set by the product itself.

Monitor users who follow the process at each conversion level to find optimization points at each level; draw the conversion paths of users who do not follow the process to find space to improve user experience and shorten the path. We can analyze the conversion rate of each step in the process through trend, comparison and segmentation methods:

Trend : Analyze the changes in the timeline, which is suitable for monitoring the effect of improving or optimizing a process or a step in it;

Comparison : By comparing the conversion rates of purchase or usage processes between similar products or services, problems in certain products or applications can be discovered;

Segmentation : Segment sources or different customer types based on their conversion rates to identify some high-quality sources or customers. This is usually used to analyze the effectiveness and ROI of a website’s advertising or promotions.

PEST Model

The so-called PEST actually refers to the four aspects of politics, economy, society, and technology. In essence, it is to analyze user behavior through control of the environment.

When analyzing macro-environmental factors, the specific content of the analysis will vary due to the fact that different industries and companies have their own characteristics and business needs, but generally speaking, the four major external environmental factors that affect companies should be analyzed: politics, economy, technology, and society.

Political environment : political system, economic system, fiscal policy, tax policy, industrial policy, investment policy, etc.

Social environment : population size, gender ratio, age structure, lifestyle, purchasing habits, city characteristics, etc.

Technological environment : depreciation and scrapping rate, technology update rate, technology dissemination rate, technology commercialization rate, etc.

Economic environment : GDP and growth rate, total import and export volume and growth rate, interest rate, exchange rate, inflation rate, consumer price index, residents’ disposable income, unemployment rate, labor productivity, etc.

4P Model Theory

4P stands for product, price, channel and promotion. In the marketing field, this market-oriented marketing mix theory is the most commonly used by enterprises.

It can be said that all marketing actions of an enterprise are carried out around the 4P theory, namely: product, price, channel, and promotion . By combining and coordinating the four, the company's market share can be increased and the ultimate goal of making a profit can be achieved.

Product : From a marketing perspective, a product refers to anything that can be provided to the market, used and consumed by people and satisfy their needs, including tangible products, services, people, organizations, concepts or a combination of them.

Price : refers to the price when customers purchase products, including basic price, discount price, payment period, etc. There are three main factors that influence pricing: demand, cost and competition.

Channel : refers to the various links that a product goes through during the entire process from the manufacturer to the user.

Promotion : refers to the company stimulating user consumption through changes in sales behavior, using short-term behaviors (such as profit sharing, buy one get one free, marketing on-site atmosphere, etc.) to promote consumption growth, attract users of other brands or lead to early consumption to promote sales growth. Advertising, publicity and promotion, personal selling and sales promotion are the four major elements of an organization's promotional mix.

Related reading:

1. Data operation: How can operations train their data thinking?

2. Data operation: 8 essential data analysis methods for operation!

3. Data operation: How to use data analysis to achieve user growth?

4. Data operation: How to build a data indicator system?

5. Data operation: How to analyze data more efficiently and more valuablely?

6. Data Operation: How can big data make users more willing to pay?

Author: Data analysis is not a big deal Source: Data analysis is not a big deal