Modern firms urged to brace for 'big data'
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BIG DATA is poised to make a significant impact on businesses, including the way they market and communicate with consumers, according to a professor from Northwestern University in the United States.
“Big data is real, but in the very early stages of development and usage,” Frank Mulhern, associate dean for the integrated marketing communications programme at the university’s Medill School of Journalism, told a seminar held by the Thai Direct Marketing Association last week.
Big data, which has become a “buzzword” in business today, is still in its infancy and marketers should view it as one of several components in the digital revolution.
“Big data” refers to the explosion of data in digitally connected businesses and societies that can be leveraged for better financial performance and marketing effectiveness.
“Be wary of vendors driving the adoption versus marketers who should prioritise brands and consumer experiences,” he said.
Data will get even bigger as more and more of the things people experience in life become digitally connected. The “Internet of Things” will digitally connect products such as clothing, appliances, cars, toys and just about everything else.
The digitally connected product will generate streams of data. For example, laundry machines, when connected to the home Wi-Fi, can send updates to homeowners’ mobile devices about the status of laundry cycles and detailed information to appliance manufacturers about how the products they make are being used.
The digitisation of media will transform marketing as much as, or more than, the invention of television, which gave us modern advertising, big brands and mass distribution, Mulhern said.
“Note that, at best, previous data levels about consumers ended at the point where shoppers checked out of the store or e-commerce site.
“The next wave of big data in marketing is consumption data – household or office information about how products and services are used,” he said.
Retailers, which have increasingly gained power over the past years, could become even more powerful through their richness in consumer data, which they will be able to use for better insights.
“On the other hand, I don’t see many retailers doing analytics [on their data]. They just send information to the manufacturers of brands to do analytics,” he said.
Data-rich and data-driven industries such as finance, travel, airlines, hospitality and healthcare are poised to reap benefits from big data’s evolution.
Small and medium-sized companies usually have no resources to harness data for garnering insights, although they are generally faster to adopt changes and a small improvement could induce significant gain for them, compared with large companies.
When done correctly, the analysis of big data can enhance the quality of the consumer’s experience and improve organisational performance. However, when poorly executed, the use of big data can lead to more intrusive advertising and negative consumer experiences.
While most attention is on data, analytics and execution, the softer areas of people’s and organisations’ readiness are among the most important, Mulhern said.
Most marketers believe their companies lack the technical skills and talent to take advantage of big data, he added.
