Conquering Legacy Thinking & Bias In A Big Data World25 Jun
The world is changing, and it’s doing so in a ‘big’ way. Big Data is a term being tossed around by technology pundits around the world to describe the way customer data is being stored and used. Big Data describes information that is too large or complex to be analyzed by traditional data analysis tools. However, many organizations are losing customers, and money, by the boatload due to legacy thinking and analysis. It’s important for companies to change their thinking and not fall into the legacy trap.
These days, your average consumer has access to the things they want at the exact time they want them. This is great for consumers because they don’t have to search far and wide for something, or have to go store to store. They can seek out that product online, or find a local store that carries it – straight from the palm of their hand. This is also a great opportunity for companies to more easily find their target customer and advertise directly to them. Not only that, companies now have the power to obtain a plethora of very specific data about their customers and use that data to their advantage.
You might be thinking, “This concept isn’t new, it’s the foundation of traditional marketing.”
Well that’s just it. Traditional marketing is falling by the wayside for many industries, and companies stuck in legacy or traditional strategies are going to lose out to more agile data driven organizations. By ‘legacy’ we mean that companies continue to use automation or programmatic ad purchasing to drive customers and revenue. Even when these processes involve certain data analysis, companies could be missing out on a lot of customers who are ready to purchase. In a recent survey by Direct Marketing News over 60% of companies surveyed admitted they do not integrate insights such as web search (Google, etc.), social, or related audience data to drive new marketing initiatives and campaigns, and rely on outdated models and data analysis to create advertising campaigns and the like.
One example was quoted in the Wall Street Journal CIO Journal of a retailer whose merchandisers insisted on displaying full outfits in their stores despite data that suggested customers do not purchase outfits; they purchase individual pieces. The retailer hoped they would cease spending so much time and money putting outfits in front of customers and focus on selling individual pieces. The merchandiser is stuck in legacy thinking and tactics and it is slowing growth and sales.
Another example, one that has a more positive outcome, is the example of Netflix. Netflix was the only media outlet that took the chance of airing the popular House of Cards television show – without a pilot episode to forecast audience feelings and engagement. Why? Netflix already had sufficient data about customer’s viewing habits and was confident that their customers would like such a show. They were exactly right. They used the data of customer viewing habits and reviews to their advantage and knew exactly what their customers wanted. In another Netflix example, the company states that 75% of what their subscriber’s watch comes from a recommendation based on other customers’ activities.
So, what do these examples mean as far as Big Data is concerned? It means that targeted, data-driven initiatives and offers increase customer engagement and satisfaction. This in turn drives revenue growth. From a recent report by CenturyLink using these examples it was stated that, “..big data will sort winners from losers in so many markets. The retailer is falling further and further out-of-sync with its customers, while Netflix not only stays in sync with continuous insight from customer interaction data — it also leverages that data in real-time to drive business growth.”
Now you’re probably thinking, “OK, I get it, but what does this mean for me and my organization?”. Well, as you can see a lot is stake in a world full of data. It’s important to not only learn how to obtain the correct data but organize it and analyze it the right way in order to drive business growth. The first step is finding technology partners that can help you achieve this goal with database management, cloud hosting, and IaaS (Infrastrucuture as a Service) services. By creating a strong infrastructure your business can begin collecting the data it needs to drive growth and allow you to create a ‘data driven culture’ within your company.