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Big Data Is Exactly What You Think It Isn’t

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May 16th, 2012
  • Marketing Optimization. The second phase of Big Data will be using data from purchase transactions, shopping transactions (online) and social networks to optimize marketing messages that retailers provide to their customers. In this phase, Big Data is used as a way to align the marketing organization with the customer base to a previously unseen level.
  • Customer Optimization. The final phase of Big Data for retailers will be in creating systems that make traditional marketing a thing of the past. In this phase, retailers will use the data available to create personalized one-on-one marketing and sales messages for each of their clients. These algorithms will be self-tuning and will adjust to changing market and customer dynamics, optimizing customer acquisition and retention spending.

    • The biggest challenge is that Big Data is not a standalone project; it is a means to an end. If a retailer is trying to understand their customer sentiment, that sounds like it might be a Big Data project. If that same retailer is trying to create a marketing optimization platform, that sounds like it might be a Big Data project, too. And if the retailer wants to determine which potential market opportunity that the business should go after, that also sounds like it might be a Big Data project. Companies do not implement Big Data just so they can say that they have. (Let’s face it, a lot of data warehouse and data mart projects were done for simply that reason.)

    If you really want to get an idea about what Big Data is and where you should go from here, the first thing that I would recommend is to go to YouTube and search for “Hadoop,” which is the leading open-source project for processing big data. I would then check out all of the great videos and training available at www.cloudera.com, one of the first movers in the Hadoop platform and consulting space. Do a Google search on “MapReduce” (the core processing component of Hadoop) and see how it enables you to process unstructured data. Also search for “No-SQL” and other column-oriented database technologies.

    There are so many technical differences between how these platforms operate versus traditional data warehousing projects that you really have to spend the time to learn the underlying technologies. (It is pretty wild when you understand the difference between thinking about data in columns rather than in rows.) It will easily take you weeks, if not months, of focused effort to get through all the noise to a place where you can truly understand how these environments operate. Only then will you understand the potential of these platforms and what opportunities your business can explore.

    What do you think? If you disagree (or even, heaven forbid, agree), please comment below or send me a private message. Or check out the Twitter discussion on @todd_michaud.

    Pages: 1 2

    Posted in CRM, E-Commerce, In-Store, IT Strategy/Industry, Mobile/Wireless/Contactless, Software
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    One Comment | Read Big Data Is Exactly What You Think It Isn’t

    1. Thad Peterson Says:
      May 17th, 2012 at 10:17 am

      Todd- Great article, thanks for clearing the “clouds” away from the “big data” hoopla. I agree that it’s going to completely change the way retailers deal with their customers (and their suppliers), but there’s going to be a whole bunch o’ garbage out there before people really understand. Thanks for helping.

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