The Real Potential of Big Data: Three Ways That It Can Improve Marketing
This October, we're all about Big Data. We asked a group of exceptional data experts to enlighten us. They answered this tough question: “How will the recent explosion of big data affect marketing & advertising innovation and productivity in the future?” This post is by Subu Desaraju, Vice President/Group Director, Strategy & Analysis, Digitas. As VP/Group Director of Strategy & Analysis, Subu leads digital initiatives for a number of Fortune 500 clients at Digitas, including Sprint and GM. He brings more than 14 years of industry experience to his role, spanning digital performance marketing, CRM, e-Commerce, and emerging media. A seasoned digital marketing leader, Subu specializes in developing transformational marketing initiatives enabled by data driven insights and delivered through marketing platform/technology innovation.
“How will the recent explosion of big data affect marketing & advertising innovation and productivity in the future?”
Companies with big customer bases and footprints have always had a large volume of data available to them. But historically they’ve struggled to leverage it: they’ve fragmented the data into silos because they lacked the technology platforms and know-how to tie it together and translate it into actionable insights.
But in the last five years, our industry has seen technology, processing and marketing platform innovation that has enabled brands to not only grasp the possibilities of “big data” but also pushed them to embrace it. Today, marketers are using big data processing frameworks to store data flowing in from different channels and tie it with customer data in the warehouse. Advances in analytic platforms have allowed them to take advantage of big data in real-time and deliver actionable insights back to marketers. As media becomes more digital and addressable, a new frontier is emerging, one where brands will place data and insights at the very core of program planning and execution. Here’s what these advances will allow them to do:
1. Deliver superior consumer experiences: As marketers digest big transactional and behavioral data sets from online and offline sources they’ll be able to create narrower segments that precisely describe consumers and analyze this data in real-time. Insights from big data analysis will enable marketers to not only precisely understand behavioral profiles of their customers and prospects but also accurately anticipate what they’re likely to do next. These insights, when combined with the ability to recognize customers, will allow marketers to deliver highly tailored and dynamic experiences - online, in the store and at home. The brands that do this right will see a big increase in the engagement of their consumers.
2. Improve overall advertising efficiency: Recent industry reports show strong growth in real-time bidding models (RTB) where advertisers can leverage audience and placement data to maximize the value that they derive from media. Big data and analytics is likely to extend RTB models well beyond display and even digital to encompass the overall media ecosystem. And the RTB platforms of the future will be able to link into inventory across all addressable channels and enable brands to optimize the price paid per exposure in real time. By matching media inventory demand with supply in real time, media buying and bidding platforms will drive create greater market efficiencies (i.e lower prices). These lower prices mean that both advertisers and publishers will be able to better allocate their investments, benefiting the consumer.
3. Increase profitability: Big data and analytics will become central to driving profitability. As marketers become more responsible for the bottom line, they will become more focused on the quality of consumers that they’re acquiring and retaining. Innovation in location-based services and mobile profiling will enable marketers to personalize messages and offers in real time based on the profile of a consumer, their location and the inventory available. In addition, marketers will be able evaluate the impact of their programs not only on short term sales but also on long term customer perception and loyalty.
It is evident that big data is already transforming how brands are thinking about their go-to-market strategies. Innovation in big data processing from media channels, media buying and feedback loops will mean that brands can deliver more meaningful and personalized experiences, understand consumer responses, and improve their offering to build stronger consideration and loyalty.
Check out the last post in this series, by Gary Singer.