Evan Schuman's StorefrontBacktalk

Although marketing may soon have a larger technology budget than the IT team does, marketing chiefs may also find themselves taking a back seat to a mathematician (data scientist) when it comes to reporting marketing ROI to the CEO. Who do you think a company will value more, someone who works with an agency to create a great commercial series or free standing inserts or someone who figures out how to optimize the retailer’s relationship with each consumer through advanced algorithms?

I’m not saying that marketing will move from an art form to a science completely or that this change will happen overnight. But I am saying that data scientists will have hard numbers (ROI) to backup their activities, where a marketer will be using Neilson and focus groups. Where do you think the money is going to go?

Retailers are looking at tremendous opportunity to leverage their data for improving sales. Netflix has spent millions of dollars in crowdsourcing the algorithms for its recommendation engine because it understands the power of that data.

Many people scratched their heads when Wal-Mart acquired Kosmix for $300 million and launched Wal-Mart Labs, but, to me, it makes perfect sense. It was a talent acquisition with some nice Intellectual Property that will help the chain launch its need for advance coding, data mining and processing.

This isn’t a small challenge. Processing big data is hard (and beyond most retailers’ capabilities today). But automating processes based on the information extracted from that big data processing, that’s infinitely harder.

To give an example of what I mean, imagine processing every tweet from all of your Twitter followers and determining what actions you need to take with each person in an effort to maximize your relationship with them.

Do you send them an E-mail? A text? Present them with an offer at Point of Purchase? Do you offer them a 10 percent discount? Twenty percent? Thirty? Is it for a specific item or category? Do you offer them a perk instead of a discount? Do you offer something they can pass along to their friends and followers?

You can see from my example, which only talked about one social network, how complex this can get in a hurry. But it also shows how valuable it can be. A recent Forrester report shows that the majority of Groupon purchasers would have gone to the retailer making the offer anyway and paid full price. Ouch. What if you could identify that up front and offer your loyal, would-be customers a smaller cost perk instead of a 50 percent discount for their business?