The 1990s saw the emergence of Big Data, in reference to sets of data that were so massive that it was impossible for traditional data analysis software to analyse them. As time passed and technology improved, increased computing power meant that analysing these data sets became easier with time, and today, the information provided by such analytics is used in a variety of fields. A recent member of this new revolution is the field of marketing.
Some of the biggest use cases of big data within businesses are core marketing processes, including customer analytics, operational analytics, fraud and compliance, new product & service innovation, and enterprise data warehouse optimization. It’s safe to say that big data and marketing are married to one another through a deep bond of smarter insights informing improved efficiency and performance. So what are the various areas where data analytics is helping marketing? Let’s start with pricing.
Pricing fluctuations depend on global factors that may be better understood by big data. Data from McKinsey paints a clear picture of the relationship between pricing and data. More than 70 percent of a company’s revenue comes from its offerings, but about 30 percent comes from variable pricing insights and fluctuations. A 1 percent price increase can translate into an 8.7 percent increase in operating profits. Using data analytics to predict the right moments to raise prices can thus translate into consistently better performance across the board.
What’s even more interesting is that Forrester Research found that one of the biggest impact areas of big data was in customer relationship management, which would be enhanced significantly if it was employed at a corporate level. When these processes are leveraged correctly and produces actionable insights instead of just reaffirming existing beliefs, it can be an agent of truly visionary decision-making processes.
In a related survey, Forrester also found out that about 40 percent of consumer marketing associates were using data analytics to improve their response times to evolving market trends and 35 percent of them were using the technology to mine insights from the field.
One of the greatest thought leaders in the space of big data has been Satya Nadella, the CEO of Microsoft. Talking about its power, he remains optimistic about its future potential and is open about leading from the front, “There isn’t a single industry that isn’t being transformed. We collectively have the opportunity to lead in this transformation.” He isn’t alone in his optimism – Rakuten, one of the world’s largest consulting companies, has also recently launched its own consulting arm in the field.
The total power of becoming a big data economy has some overarching positive benefits too, according to WNS Global Services Group CEO Keshav Murugesh, “The combined power of harnessing big data and digital solutions can drive tremendous results in improving the citizen experience, implementation efficiency and boosting the nation’s economy. If big data can be put to cutting-edge use for our corporations and clients, it can very well be a catalyst for the economy and the country.”
However, there is also insight in looking at the failures that marketing has gone through in its headlong rush to adopt big data. In November 2017, Gartner Research estimated that 60 percent of all big data projects fail, but after studying their researched companies carefully, they understood that the problem lies deeper and had to revise their estimate. The new figure? 85 percent.
So why is it so hard to have successful big data projects? It’s all about having actionable insights that come out of big data. Often the problem revolves around the idea of execution. Everyone wants to be all-in in the big data game, but few have actually produced insights that are actionable.
While industry experts believe that big data will reach $16 billion by 2025 in India, this growth will be stifled if not met with the right mentality from marketing management. Madalasa Venkataraman, Chief Data Scientist at TEG Analytics, concurs with other experts who are wary of being ultra-positive about the impact of big data. She believes that the data is only as good as its source, and it needs to have a long-term impact in the organization’s core offering – or allow them to pivot towards a new offering – to be truly called “transformative”.
As we go forward, the ever-increasing levels of connectivity mean more and more volumes of data generation. For marketers, this represents a veritable goldmine of insights into consumer behaviour, preferences, and trends. Delivering customised campaigns and marketing solutions has never been easier, and India’s big data-driven marketing revolution is only just getting started.