Big data is for small business too
Big data. Instinctively you may think of a dark bottomless ocean of data that only large enterprises armed with divisions of data scientists and servers the size of supertankers could possibly begin to store, analyze or make sense of. Well, we hope you’re sitting for what we’re about to tell you next. Thanks to the advent of cloud computing, big data is not only accessible and affordable for small- and medium-sized businesses (SMBs), but – we’d argue – essential. It enables you to truly understand your business and your customers, and make better-informed decisions.
What is big data?
Industry leaders use phrases like “volume,” “velocity” and “variety” to describe this elusive creature. Others have even thrown in additional V’s such as “veracity” and “value.” While these are all fine and dandy, we’re going to cut to the chase – big data is a collection of data from traditional and digital sources inside and outside your company that represents a source for ongoing discovery and analysis. Think of it as correlating unused data to glean new actionable insights.
What kind of data?
There is an ever-increasing quantity of data out there in our increasingly digital world. In defining big data (yes, it’s a large task), it’s important to understand what kind of data we’re dealing with. This is tricky, as big data has become somewhat of a catchall phrase that encompasses virtually every data type. But for the sake of practicality, let’s hone in on three kinds of data that go into big data: businesses are tapping into transactional data (e.g. customer purchase history); machine-to-machine data (everyday devices or “machines” people use that are now connected to the internet, for instance – cars, household appliances, health monitors, etc.); and human interaction data (e.g. social media posts, email marketing, web browsing) to build a 360º view of customers that informs better decision-making.
Where do I begin?
For starters, get comfy with Google Analytics. It lets you measure sales and conversions, provides meaningful insights into how visitors arrive on your site, how they use your site and how you can keep them coming back. Once you’re ready to mine and combine data beyond your website (aka: go big …), there are some killer cloud-based services available. Companies ranging from established giants such as IBM, SAS and Microsoft to scrappy startups such as Tranzlogic, InsightSquared and Canopy Labs offer affordable, data-crunching services that collect, integrate and centralize customer data to supply your business with actionable insights.
Big data in action: Canadian Opera Company
The COC was experiencing a lot of single-performance sales and wanted to encourage additional ticket purchases. So they delved into big data. Working together with Canopy Labs, they centralized customer purchase history, donation history, web visits and email activity to develop individualized 360º profiles of every COC customer. Next, they targeted customers with personalized communications (specific to the performance attended, asking if they enjoyed the opera, recommendations based on browsing/buying patterns, etc.) at a time when opera was on their mind – the email was timed to arrive during the performance intermission and the telemarketing team followed up the next day. The results? Email response rates shot up from 10% to 67%, while close rates for sales calls increased from 15% to 50%.
What does big data mean for your business moving forward?
Here are a few ways we see big data making a big impact for small- to medium-sized businesses (SMBs):
Support your spending
Remember the old adage, “Half of my advertising is wasted, I just don’t know which half”? Well, the beauty of big data is that it helps you find the truth in the numbers. It takes the guesswork or “gut feel” out of the equation and helps you make data-informed decisions. As a result, your marketing spend can become significantly more precise.
Better understand your customer
The ability to collect, manage and make sense of the flood of customer data pouring in through both online and offline channels helps you truly understand your customer. It helps you see customers as individuals and cater to them uniquely. It helps you anticipate what customers will want tomorrow. As demonstrated in our COC example, this level of customer insight can make marketing efforts significantly more successful.
Make accurate predictions
The predictive power of big data is far-ranging. Just as it can enhance marketing, it can help optimize aspects of your business like operational efficiency too. For example, a zoo in Washington combined ticket sales and visitor data with real-time weather forecasts to anticipate how many customers would show up on a given weekend. This in turn informed them as to how many staff members they would need on those days. They predicted attendance within 200 people (out of several thousand) and adjusted labour plans to maximize customer service and minimize the risk of over-staffing.
But these ideas are really just the tip of the iceberg. Big data is here and SMBs that start leveraging it will lead the way. What kind of data could your business tap into to make a difference?
Don’t hesitate to contact us to learn more about how your SMB can get started with big data.