Business analytics (BA) has become increasingly important for companies to gain valuable insights from big data and ultimately competitive advantage. However, little empirical evidence exists regarding the mechanisms through which BA impacts on competitive advantage. In light of this paucity, this paper aims to advance our understanding of the impact of BA on competitive advantage. First, this paper provides a BA classification. Second, drawing on contingency theory and the resource-based view, it develops a research model that specifies the paths from BA to competitive advantage. Third, it empirically tests the proposed model using structural equation modelling, offering valuable insights into how different types of BA impact on competitive advantage. Fourth, it systematically tests how resource value, rarity and inimitability impact on competitive advantage. The findings demonstrate that BA, through the mediation of a data-driven culture, positively impacts on information processing capabilities, which in turn have a positive effect on competitive advantage. The findings also demonstrate that resource value, rarity and inimitability partially but strongly mediate the impact of information processing capabilities on competitive advantage. Finally, the paper contributes to managers' knowledge by demonstrating how different types of BA should be implemented to develop information processing capabilities and gain competitive advantage.