ADOTAS – Big Data. Everybody’s talking about it. You’d think it was a cure-all, the ultimate panacea. The greatest thing to hit marketing since the Wendy’s “Where’s the Beef?” campaign. All kinds of companies in almost every niche industry are trying to extract value from Big Data. Like ancient alchemists trying to convert lead into gold, they’re feverishly working to turn their vast stores of data into something beneficial. Two questions remain unanswered: How many companies have really adopted Big Data successfully, and has this magic bullet really delivered on its theoretical promise?
I see the challenge of Big Data much as the one that previously confronted the oil and gas exploration industry. There was plenty of oil and gas to be found but trapped in places that were cost prohibitive and technologically impossible to extract at the time; as the price of oil went up and new technology and techniques were introduced, the situation changed. The same is true for Big Data as the technology and ability to extract its vital component – actionable insights – was beyond most companies’ reach. Now, however, we are on the threshold of being able to drill down and enjoy the boom that is data-driven marketing.
Moving Into The Mainstream
Research reveals that Big Data has finally gone mainstream and has moved beyond the hype. In fact, researcher International Data Group (IDG) estimated as far back as 2012 that the Big Data market would grow at an annual rate of 31.7% until 2016. Marketers across the globe are exploiting Big Data for actual gain and analytics are becoming the bedrock for innovation, competitive positioning, customer experience, and productivity. Research shows that Big Data is being used for CRM, marketing campaigns, and strategies.
Big Data has a number of advantages that are now paying off for marketers seeking a better return on their investment, including:
- Greater scalability at a lower cost.
- Faster processing.
- Real-time reporting, real-time insights and faster decision-making capability.
There are five drivers that are poised to help marketers take better advantage of Big Data:
- Mass data collection across multiple touch points becomes standard. As users engage with companies through more channels, companies that can acquire, sort, and find logic within all these diverse data points will drive increased user engagement and loyalty.
- Marketers will have a better handle on the data they manage. Marketers are recognizing the need to access and leverage user information to personalize their marketing campaigns and data is becoming increasingly available to non-technical personnel.
- Social media will migrate into Big Data. Marketers will find more ways extract valuable data from their socially connected users to integrate loyalty programs, analytics, and web experiences.
- Permission marketing will become the norm. As Big Data gets bigger, privacy becomes more of an issue and the companies that show a commitment to data privacy and have clearly defined data usage policies will gain more consumer trust.
- Programmatic marketing will end the era of delivering generic marketing messaging. Big Data allows programmatic marketing to serve relevant content to users based on their activity and customer profiles to increase engagement.
Making The Impossible Possible
Marketers are desperately looking for new ways to help them harness the power of data and convert it into practical tools, apps, and campaigns.
Big Data offers marketers an opportunity to implement strategies that were once considered impossible or impractical. There are three elements driving change and creating an evolution that make Big Data practical:
- Economics: Commodity hardware, low cost storage, and memory are creating opportunities that were beyond the budgetary reach of most companies.
- Advancements in technology : Systems available now have gone well beyond the scale and performance of those available a few short years ago; the investment in these technologies is making it possible to address Big Data.
- Valuable data sources: New data sources including social media, machine-generated data, and sensor data are powering a more complex analysis of businesses.
To make Big Data actionable, marketers need to focus on these types of data:
- Transactional data: a traditional source of data, which usually can be found within the confines of data warehousing, CRM, and large-scale analytics.
- Online data: a digital source, which is contained within Web reports, user profiles, or predictive models.
- Social and mobile data: the latest data source, which is collected from monitoring and listening tools, then processed via text and sentiment analysis.
- Attribution, Site Behavior and Segmentation: marketers must look at what type of media mix and messaging was responsible for the attainment / lack of attainment of the company KPIs such as online messaging and offline sales, funnel analysis, site-side behaviors, and consumer segment behavioral analysis.
- Testing: key to optimizing the impact Big Data has on creating actionable insights that really move the sales volume. A/B and Multivariate Testing results that provide insights into messaging, media mix, retargeted message frequency, pricing, product positioning are but a few types of insights to be gained via analysis of testing results.
While Big Data is now used strategically to guide tactical decision-making, its ownership must evolve and migrate from IT to the marketing department and other core business units. Migration is imperative if companies are going to truly benefit from Big Data. The organizations that will gain a competitive edge and thrive are the ones that can exploit Big Data and change from their current IT-driven model.
Big Data: Who Owns It?
An issue that continually arises is who actually should be the keepers of this cache of data. Should it be IT, finance, or marketing? If Big Data is supposed to set the strategic direction of a business, this question needs to be answered. To ensure that decision-making is optimally effective and targeted, it needs to be driven by the heads of business units in a way that can effectively activate the insights gained through the analysis of Big Data. The organization needs to decide if the corporate walls established 10 years ago are still relevant when such powerful data that can change the fate of the company are being locked away because of corporate politics and insecurities.
Part of the data ownership issue exists because businesses haven’t organized their data effectively yet. In fact, most marketers do not currently manage their own data; it’s left to a third party or is simply lying dormant and not being used to the company’s full advantage.
While Big Data (especially predictive analytics) holds great potential, it has to be actionable and accessible beyond the IT experts who may keep it locked away- beyond the reach of the rest of the organization.
Quantity vs. Quality
Another layer to the Big Data issue is that many companies seem more concerned with acquiring large quantities of data instead of focusing their attention to the quality of the actionable insights that data should provide them. The main thrust should be to get the right data in the hands of the right people at the right time.
The Bottom Line
To deliver on the promise Big Data has to offer, companies and marketers must: value the data they’ve already generated; move from a technology-driven concept to a business-driven one that evaluates which data elements provide the greatest opportunity; and investments in Big Data need to focus on selling, not serving, as creating genuine value for consumers. The easy or default position is for marketers to use Big Data in a quantitative rather than qualitative way. Unless marketers see the value in the insights the data provides, rather than the data itself, they are doomed to fail.