When it comes to data, big is not always better
Despite all the papers, presentations and personal conversations that have been devoted to it, most marketers I talk to still haven’t warmed up to “big data.”
According to IDG Enterprise, about one-third (31%) of companies will be managing more than one petabyte of data by the end of this year. (Note for non-Computer Science majors: One petabyte is equal to one million gigabytes.)
How can you possibly get your arms around a number that is so, well … “big?” And even if you do, won’t it be a hollow victory, since we all know even larger volumes – the exabyte, zettabyte, yottabyte, et al. – are just around the corner?
It’s no wonder marketers feel overwhelmed with big data . . . and it’s precisely why I propose a completely different approach.
Rather than feeling bogged down under the yoke of big data, marketers need to take control by putting the focus back where it belongs: on the small data –the bits of data your customers provide whenever they interact with your brand.
Every time your customers choose to tell you where they are, what they’re doing, what they want and what they’re thinking, they offer information you can use to enhance their experience with your brand. Over time, all the data you earn from your customers becomes the currency of engagement, and as I have discussed before,
Engagement is the key to a better customer experience. You can gain significant competitive advantage by leveraging small data – contact details, website interactions, in-store purchases, etc. – to obtain deeper insights about your customers’ preferences and buying behaviors.
To help move you in the right direction, here’s a short to-do list for taking control of your small data:
- Establish trust with your customers via opt-in and privacy-led approaches. Many marketers are uncertain about collecting and using customer data because they fear consumer backlash. Our research of millennial buyers shows that they are 7 times more likely to give personal information to a trusted brand. And while it’s true that recent high profile media stories about identity theft, data breaches and privacy issues have made consumers wary about sharing personal information with brands, the preponderance of research in this area has repeatedly shown that customers are generally amenable to data collection and tracking – if they’ve opted in and if their information is used responsibly. Most recently, a 2013 Forrester study found that consumers are more loyal to, and more willing to share data with, brands they trust, leading the researchers to conclude that marketers should take a privacy-led approach to customer data collection and use.
- Bridge the silos. Most organizations store customer information in multiple disparate silos, but the truth is, you simply won’t be able to leverage your small data unless/until you can integrate it. Make a commitment to an enterprise-wide customer data stewardship plan – one that’s integrated and ongoing. Be realistic, though. Overhauling data systems and paradigms of corporate structure won’t happen overnight. Plot a strategy, and then proceed step-by-step.
- Offer value in return for information. Our recent global research on Millennials shows that they realize companies collect data from them – and in return, they expect a fair exchange of value. What’s “fair?” Forty six percent of those surveyed said that they will share their data if it means more relevant offers. — offers that are well-timed and relevant. Interestingly, this trust-value cycle reinforces itself. Cultivating deeper customer relationships builds trust, which in turn, motivates customers to open up access to even more data, which then helps you market even more effectively . . . which helps deepen the relationship even more . . . and so on.
It’s time to stop feeling overwhelmed by big data – because in the end, it’s not the volume of data that’s important. What’s important is what you do with the data you have. So, shift your focus to small data. Be up-front about what you collect. And use it to improve the customer experience. You’ll feel more in control, and ultimately, you’ll start driving more revenue, as well.
To learn more, and download a companion paper visit – www.sdl.com/fivetruths-data