There is quite a bit of buzz lately about “Big Data” and what it means to business. I recently saw an infographic showing how in the past 2 years, more information has been collected and stored than in all prior history. More companies are reading about this and are collecting more information about customers and prospective customers.
The question every company should ask is, “What are we going to do with this information?” Too many marketers are gathering loads of customer information without any specific plans for using it. Pouring information into the Marketing Funnel without a strategy for the output is tantamount to turning on a faucet and letting the water run straight into the sink drain.
It’s very easy to get lost in a sea of data and to spend money trying to make use of old information. Data storage is cheap, so Marketing and IT staff don’t seem to worry about the volume of information being stored, but there are several factors that negate the low price of storage in the overall value of stored data:
1. Relevance: Information Lifecycle and the value of data over time
2. Regulation: existing and evolving privacy and electronic marketing rules and best practices
3. Hygiene: the cost of keeping all of that data clean
Each of these has a cost, which needs to be factored into the overall value of a marketing analytics program. The establishment and continued use of best practices for each of these factors can help contain the cost of making use of stored data..
Analytics should be considered a marketing expense and should be measured accordingly. Marketing needs to define goals, for example: x new customers, or x% increase in repeat business, for the analysis team to achieve. Baseline measurements should be taken and recorded. Metrics need to be defined for these goals and a feedback loop should be applied to the analytics program to be certain that it is producing ROI and the results that are expected by the Marketing team.
Knowing more about your customers is great. But if you have no idea of how to apply that knowledge to grow your business, it’s wasted information.
- The Utilization Gap: Big Data’s Biggest Challenge (forbes.com)
- Persistent Myths About Predictive Analytics And Big Data (blogs.sap.com)
- Big Data: The Goldilocks Paradox (forbes.com)