Big data is transforming industries at a rapid rate, and the age of big data is here to stay. With more and more data being collected than ever before, the ability to extract meaning from data is only going to grow in demand. The power of data is already shaping our lives in ways that we probably don’t realize and with so much of our lives leaving an electronic footprint more insights are being developed about our personal habits.
Every time you shop, retailers are analyzing your buying patterns and trying to figure out your likes and dislikes as well as what other products you might buy or coupons you would use. Charles Duhig from The New York Times wrote a story on how Target statistician Andrew Pole poured through data looking for patterns to determine if a shopper was expecting a new bundle of joy. From the NYT: “(Pole) ran test after test, analyzing the data, and before long some useful patterns emerged. Lotions, for example. Lots of people buy lotion, but one of Pole’s colleagues noticed that women on the baby registry were buying larger quantities of unscented lotion around the beginning of their second trimester. Another analyst noted that sometime in the first 20 weeks, pregnant women loaded up on supplements like calcium, magnesium and zinc. Many shoppers purchase soap and cotton balls, but when someone suddenly starts buying lots of scent-free soap and extra-big bags of cotton balls, in addition to hand sanitizers and washcloths, it signals they could be getting close to their delivery date."
Based upon their “pregnancy scores” Target started sending coupons. One angry father contacted Target about all the baby coupons they were sending his teenage daughter, accusing them of encouraging her to get pregnant. The eerie part was Target figured out the teenage daughter was pregnant before the father knew.
While the term “big data” is relatively new, the process of gathering and storing large amounts of information for eventual analysis is ages old. Big data analytics is the process of examining large data sets to uncover hidden patterns, correlations, customer preferences, trends in the market and other information that can be used to make business decisions.
Big data analytics could be a key differentiator for your business. Because of the speed of the tools being used and the amount of data available, businesses can gain insights about decisions that affect their business today and not just in the future. Here are some of the ways big data can impact your business:
1. Cost Reduction – With the availability of cloud based storage solutions, companies can more effectively store large amounts of data, making analytics more cost effective while improving efficiencies in their business.
2. Faster Business Solutions - With better tools and more cost effective storage, companies can get results quicker from their analytics, helping them identify ways to improve their bottom line today.
3. New Products and Services – As companies are able to identify trends and patterns, the ability to develop new products and services that meet customer needs has improved. This can be a significant competitive advantage for many companies.
As the desire for more powerful insights continues, so will the need for tools to assess the data, expertise around data science and analytics as well as ease of access to outside data sources to augment company data. Improvements in these areas should be good news for businesses interested in developing a competitive advantage with better products, services and insights.
What analytics goals does your company have planned for 2017 and beyond? I would love to hear some of your stories and challenges.