Originally posted on eConsultancy – November 1, 2012
We have passed the point of questioning the value and capabilities of Big Data on business success. In progressive organizations it now holds a seat at the table as a crucial resource to business. Companies have realized that there are major opportunities to use the data they already have and apply new insights across their business for incredible results.
Cloud technologies, and the advancements in data analysis give foundation to accelerating the trend. Advanced technologies like active analytics (“decisioning”), advanced algorithms, etc. are proving to be extremely effective at fueling the Big Data engine. In the new world we live in, data isn’t something to be stored and ignored, but analyzed and utilized for its valuable insights.
Big Data analysis has proven to be invaluable at helping driving decisions across organizations—from pricing and distribution decisions, to product and marketing insight—spreading a trend of ROI from end to end. There is no doubt, Big Data is now mainstream.
Marketing ROI and the role of Big Data
The impact of Big Data is nowhere more apparent than on marketing. Marketing has been a notoriously difficult discipline to prove ROI and marketers have always been under a high level of scrutiny to demonstrate real business value.
But now, we have the ability to more efficiently understand unmet needs in key customer and market segments, alongside the opportunity to test and responding to the most effective ways to stimulate customer engagement throughout the buying process. Through this Big Data can facilitate more accurate risk modeling, campaign optimization, real-time social sentiment analysis, real-time ROI measurement—and much more.
Digital spend and programmatic buying on the rise
The ability to demonstrate marketing ROI using Big Data is helping fuel digital marketing spend growth from an estimated $25 billion to and anticipated $50 billion by 2015. This increase in digital spend is also giving us more Big Data to analyze—feeding us the best, freshest and most affordable research.
The rise of programmatic buying is also fueling the ROI engine and changing the way we buy. The category is anticipated to grow to from 10% to 33% by 2016 —making it a nearly $8 billion market. With programmatic buying, specific campaigns matter less than the ROI and the processing of the data that delivers the insights for decision-making.
Real world examples
Looking at data across several industries, we pulled the below insights as examples of how Big Data can be applied to marketing:
- Automotive ad spend will increase by 14% this year to nearly $30.8 billion, with 40 percent of those budgets devoted to digital advertising. With this kind of budget, do you think auto brands are interested in how long a customer researches a vehicle before making a purchase? What about the types of ads that are most attractive to customers actively looking to purchase?
- A financial services trend is that consumers in urban areas that see an ad on Tuesday (say to sign up for a new credit card) are more likely to convert and sign up on Sunday night. Having made this connection, credit card companies can be more strategic with the messages they deliver and when.
- For a consumer packaged goods (CPG) brand, the marketing team collected and analyzed the performance data of coupons that were targeted to consumers that lived within three miles of a grocery store. By layering this data with regional data, demographic data, and average spend data, marketers can paint a robust picture of who their best customers are.
The opportunity to harness the value of Big Data, and turn it into effective strategies and programs that affect change throughout the organization, is a welcome addition, and appears here to stay.
Sometimes it is good to pass the point of no return.