The hot new technology trend changing the game for businesses and customers
We’re serving you up three easily-digestible features to help you get to grips with business’ hottest tech trend. By the end, you’ll understand what everyone means when they say “big data” and “data analytics”, how to take advantage of new technologies to do dramatically better business and gain serious competitive advantage. Warning: this content is for ambitious managers, not tech-heads. This is a jargon-free zone.
Brits have looked it up on Google some 246,000 times in the last month alone. It’s creeping into your team meetings. You’ve seen it surface surreptitiously in the business pages. You might have even caught it in casual conversation over a canapé of late. But you’re still not 100% sure about what exactly “big data” is, and why there’s suddenly so much fuss about it.
Our essential introduction is here to demystify big data and business analytics. Then next Monday, we’ll bring you the next part in our ‘Beginner’s guide to big data’ series, explaining how big data can give you strategic advantage. Read on to start learning about and capitalising on the hottest revolution in tech right now.
What are big data and data analytics?
The simplest way of describing “big data” is to say “lots and lots and lots of data” – because that’s what the term means. When people talk about big data, though, they also generally mean the process for making sense of all that data – filtering it to draw out meaningful patterns, predictions and conclusions.
What is all this data, then, and where is it coming from? Well, it’s everywhere. Think about your working day and you’ll realise you interact digitally with organisations, hundreds, if not thousands of times: you check your emails on your phone, send tweets, order something online, interact with websites, buy your lunch from the local supermarket, and so on. All these interactions create data points that can be captured.
As it happens, every day we are generating 15 petabytes of data (that’s 1,000 to the power of 5) and 12 terabytes of tweets worldwide. We create 350 billion meter readings per annum, and 500 million call data records. And those examples are just the tip of an enormous data iceberg.
Of course, for any one business, you won’t be handling 15 petabytes of data – but you could well be handling hundreds of thousands of data points; if, that is, you have systems in place to capture the way your customers interact with you on their phones, your website, in store, at point of sale, and so on. Each interaction can be captured, giving you reams of useful data that can give you invaluable insights into individual and group customer behaviour – if only you could make sense of it.
That’s where data analytics comes in. Data analytics is the process of making sense of all that data and drawing out useful patterns and insights.
What kind of insights can data analytics provide?
- Without getting into too much detail about how data analytics gives you these insights (that’ll come in the next feature in this series), data analytics can help you:
- Find new efficiencies and optimise performance
- Build incredibly detailed customer profiles on an individual and group basis
- Give customers an unprecedentedly customised user experience
- Help you draw meaningful insights and sentiment analysis from social media activity
- Reduce complaints
- Predict customer needs and behaviours
- Dramatically improve operational efficiency, customer engagement and customer retention
All that adds up to serious competitive advantage. In fact, IBM has found that organisations that use analytics for competitive advantage are 2.2 times more likely to substantially outperform peers.
We’ll explain more about how in the next feature in this series.
So why have big data and business analytics suddenly become such hot news?
In short, because of all those incredible capabilities. But the power of big data and analytics are not just being realised by chief information officers and technologists – although, as IBM Big Data Lead Matin Jouzdani has recognised: “There’s no doubt that big data is that hottest topic in IT and business analytics at the moment.” Increasingly, senior management across all disciplines are coming to see that to stay ahead of the competition, they need to understand their customers, their business and their futures in a more detailed and more useful way than rivals organisations.
At the same time, customers are coming to expect significantly more personalised and more seamless experiences with businesses, across multiple channels. Most people these days will use various channels and devices in the process of making a purchase – they might see an offer on your business’ email newsletter, then browse your website, bookmark or email a link to themselves to look at later, flick through the mobile version of your site to look at it when they have time, pop into a store or office to find out more face to face, and make a call to customer services to check up on delivery. That means there is huge pressure on businesses to join the dots between all those different interactions, track them, and provide a seamless customer experience regardless of when, where and what device the customer has chosen to use at any given moment.
The fantastic news in among this seemingly mind-boggling modern reality is that if you have the right analytics technology in place underpinning all that, you can also draw out invaluable insights into customers’ behaviour. Patterns and insights based on those browsing and buying habits might include: which channel gives you greatest ROI; how and when a customer is most likely to convert to a sale; how an individual customer prefers to communicate and interact with your business; how often they’re likely to buy again from you and at what price; who your most valuable customers are; and so on.
There will be more about this in the next two features.
Isn’t all this just for large corporates? It all sounds expensive and complicated.
Absolutely not. Medium-sized businesses are realising the potential that analytics holds for their businesses, and how integral analytics will be to surviving and thriving in the future. In fact, some 92% of mid-market CIOs say they would lead or support efforts to take advantage of analytics, according to IBM.
The Cincinatti Zoo is just one example (albeit an immensely more exciting one than most!) of how sophisticated analytics technology can help a mid-market business excel, and realise substantial uplifts in productivity and profitability. IBM Business Analytics has created more than $2.2m in total benefits for the business, and delivered full return on investment within three months.
Business analytics technology has saved the business more than $100,000 each year by weeding out promotions and discounts which were not performing well, and identifying where resources should be re-allocated. It has enabled the zoo to increase overall attendance, adding 50,000 new visits in 2011 through improved marketing.
We will return to this example in the next two features in this series, but if you want to learn more now, you can view this case study online.
This article is
brought to you in partnership with IBM
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