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Marketing Viewpoint by Ruth Winett

 

Will Big Data Solve Your Business Problems?

 

Big data offers businesses, healthcare organizations, and others tremendous opportunities to better serve their customers and patients, but big data is not a panacea. Will big data help you understand your customers? Where is it best applied? What are its limitations?

What is Big Data?

Big data refers to "the massive amounts of data collected over time that are difficult to analyze and handle using common database management tools. The data are analyzed for marketing trends in business as well as in… manufacturing, medicine and science." Big data includes data from "...business transactions, email messages, photos, surveillance videos, activity logs and unstructured text from blogs and social media, as well as ... data ... collected from sensors," according to the PC Mag Encyclopedia.

When Is Big Data Useful?

By combining big data and data analytics, oil fields and railroads and other "large systems" can conduct "predictive maintenance.... In other words, big data can sometimes tell you what is about to happen before a breakdown or failure occurs, according to Joel Shapiro, JD, PhD, clinical associate professor of data analytics and academic director of executive education at the Kellogg School of Management.

Big data can help you discover a problem "within a social system," but it won't find the solution. Big data can identify the "what" [what is about to happen], but not the "why." Big data will not identify the "motivations and rationale behind individual behaviors within a social system," says Shapiro. To find out why customers behave in a certain way, adds Shapiro, use qualitative approaches, such as surveys, interviews, observation, and focus groups.

Your salespeople may report that customers are generally satisfied. Still, renewals are down. To find out why, speak with customers or even observe. Uncover the "why," and also the "why behind the why." In this way you can find out about problems with your product or service or your staff and also identify new trends.

In one interview I learned that my client's biggest customer had "cut the cord" because the client's lawyer was rude and overbearing. In another instance, engineers said they wouldn't purchase a client's product because the engineers thought the product would make their jobs obsolete. Data alone would not have revealed these valuable insights.

Re-test as Optimal Solution May Change Over Time

An auto insurance company's customers seeking help had long, frustrating wait times, Shapiro reports. Once people had cell phones, they were less frustrated: they had something to do while waiting. The company looked at other issues that affected satisfaction.

While Big data can often provide useful insights, ultimately, you should talk to your customers to gain deeper insight into their motivations and the “why” behind the "why."

Winett Associates helps companies
understand their customers and markets.

Copyright © 11/18 Ruth Winett. All rights reserved.

 

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