Big Data is a buzzword that has been permeating the business world at an increasing speed in recent years, despite not actually being a particularly new concept. Given the importance and value it holds for businesses, it's important to get to grips with big data if you haven't already. So what is it and why does it matter?
In a nutshell, 'big data' is the phrase used to describe a large amount of data - either unstructured or structured - that a business will receive, access or be able to harvest on a day-to-day basis. This may include statistics on where their audience is based, demographic information, e-mail addresses, health data, insurance details, social media, financial transactions, credit checks, phone numbers, full names, and so forth. Data can come from multiple sources, although this can make it challenging to match up and correlate information across all systems. Thanks to the fact we are constantly carrying our phones around with us, it's scary just how much data we're giving out to apps, businesses, and the government on a constant 24/7 basis. Just think about the map on your phone, which is able to track and measure your every movement. Or the messages you're sending out to your friends and family on apps, which can track for keywords or emojis to understand the mood of your conversation.
When you start to think about it, you'd be surprised just how much data your business most likely has access to. Although the phrase 'big data' is relatively new, much of this data that is being captured and stored is something companies have had access to for decades. It has become even larger thanks to the rise of technology and social media. It doesn't matter so much what exact information you have though, but what is done with it. Big data plays an influential role in providing key insight into customers, and it can be analysed for insights that will help you to make better decisions, strategical business moves, and grow the business effectively. Big data is often sold on to third-party companies too for additional profit.
Although the data itself is most important, what is crucial is the way it is analysed and utilised in business. There is an almost inconceivable amount of data available to us globally, which has sky-rocketed thanks to technology, social media and the Internet. However, only a small percentage of this actually gets analysed at current.
However, it can be used to provide answers to key questions such as whether your price is right, what reductions can be made in timelines, what type of new products you should be developing, how to optimise on your marketing strategy, smart decision making, where you should target your advertising, what trends your audience base are following, and so forth. It will also help you to calculate risk and identify how something has failed and why, if it should happen. It can additionally enable you to detect fraudulent data and enable you to specifically target customers based on their buying habits to maximise sales.
The reason this is so important? It can all play a hugely influential role in generating new sales leads, growing your business, and boosting profit. Understanding your customer is one of the biggest parts of sales and running an efficient business - without a clear idea of who they are, you won't be able to serve them well. Data provides you with a clear, unbiased picture. There are other ways it can be applied, too. For example, by using big data, online companies can ensure their audience only see products they care about. Netflix analyse their big data, and in particular traffic patterns across various devices, to help improve how reliable videos are when streaming, and in helping to recommend programmes to viewers based on their viewing habits and stated preferences.
In some cases, knowing the location of your customer and how much they may typically pay means businesses can change their price depending on who is buying. This is done by some stores online based on the prices shown at their nearest physical store. Airlines will also often target people with prices based on their previous browsing habits. Big data can also help to impact algorithms. Target was found to predict their customer's future purchasing habits so well that they sent a teenager nappy vouchers before she had even told her own father she was pregnant. Many political organisations or groups will also use big data to better understand their area, and how they need to target their campaign to the interests of their audience. It helps to add a face to an area that is otherwise just a list of postcodes.
Additionally, big data can help organisations predict illnesses or potential health problems. While putting your family history into an ancestry website may seem harmless, consider what is being done with this - if it were to be sold to insurance companies, they'd be able to find out what illnesses your family died from and measure up the risk you potentially present, adding a higher premium if needed.
Big data permeates all industries and is hugely important in business right now - in Germany, the UK, Spain, France and beyond. It offers companies the chance to gain competitive advantage, as well as boost their sales and grow their customer base. It can lead to more targeted marketing, PR, sales and advertising. This all works together to help you develop your company effectively.
The biggest challenge for businesses is being able to derive meaningful insights from this data, and converting it into tangible action. With so much data available to us, it can almost feel overwhelming. It is for this reason that there has been a surge in job hiring for data scientists, who can help you get the most out of your data in a shorter time frame. It is worth making the leap into big data, however, as it helps a business make decisions based on strategy and objective facts, rather than working in a reactionary way. The key is to find a way of efficiently generating value from big data across a wide range of applications and uses, rather than just in a single win. There is also the consideration to be made about data privacy, and what can be shared and not shared. Additionally, how this information is gathered. Customers are becoming increasingly aware of the level of data they're giving away, but are also becoming more protective over it now they know the value it holds.
However, consumers are often more likely to share additional data with you if they feel they're getting something in return. It isn't just a one-way 'take, take, take' street anymore. Customers expect their data to be protected. They don't want their information to be used against them, but welcome it improving their journey or experience when it is used widely. Ultimately, many customers have the feeling of 'big brother is watching you' so it is about being open and honest, and trying to take away the feeling that you're just out to get as much data as possible.
Virginia is an Endorsed content contributor in the events, management, tech and manufacturing sector. You will find her attending any worth-mentioning trade show or forward-thinking event in Berlin, Munich, NYC or London. Avid traveller who’s always first on the trend scene.