Mining For Gold In A “big Data” World

According to American statistician, Nate Silver, “every day, three times per second, we produce the equivalent of the amount of data that the Library of Congress has in its entire print collection.” If this is the case, it may come to little surprise that the concept of Big Data’ has been coined as a huge hot topic in 2013. Yet, some companies continue to fail to integrate data analytics in measuring ROI. For instance…

If these statistics don’t startle you, I don’t know what will. Simply put, consumers are exposed to too many marketing touchpoints for there not to be a more thorough analysis of when a first impression is made to the point of purchase.  A McKinsey & Company study estimates that retailers could increase their margins by 60% alone, and European governments could reduce their operating expenses by more than $100 million simply by making use of data that is available.

To put this idea into perspective, let us consider one case of a new product campaign for a consumer electronics giant. The company used data metrics to measure how various ads prompted online sale searches that led to purchase, and found the following results:

Ad Source:   % of Budget:  Results after data analytics: 
Television 85%    —
YouTube 6% 2X as effective as television ads
Search PPC 4% Generated 25% of sales

A reallocation of advertising dollars resulted in a 9% increase in sales without having to extend the budget by one more penny. 

Seems simple, doesn’t it? So our advice is that if you are a CMO, rely less on your gut instinct and traditional marketing methods, and take advantage of the unique data sets available in order to best achieve objectives. To learn more, be sure to register for the Online Marketing Institute’s Digital Strategy Summit on March 22nd, where our very own Alexandra Gibson will be presenting on  Wrangling “Big Data” To Make The Best Marketing Decisions.  We are hoping she sets these CMOs straight.