Big Data And It’s Importance For Digital Marketing

When we talk about data wearing our digital marketing hats, we think about Google Analytics. We think about Google Trends. We think about data from our PPC bid management software. We think about all those likes, tweets, conversions and sales. Big data is much more than that, but at the same time big data has a big impact on digital marketing.

I read a statistic last week which prompted this blog post. That stat was from IBM:

Everyday, we create 2.5 quintillion bytes of data–so much that 90% of the data in the world today has been created in the last two years alone.

To me, that was completely unfathomable. What about all the stats about the England team from Italia ’90? What about all those ad spend stats I was making pretty graphs with before 2011? What about all the data banks and governments hold about the UK population?

But then I thought about what big data actually is, and I was compelled to reach out to my inner geek and research more information about it. Here’s my story…

When I first heard about big data at the start of last year, I thought about all the information that floats around individual businesses. Sales information, marketing data, customer data, costs, margins, prices…the list goes on. It then quickly became a buzzword, and is now one of the hottest topics on the digital marketing circuit.

So what is it? Big data is the term for mass volumes of unstructured and structured data. It is a ‘collection of data sets so large and complex that it becomes difficult to process using on-hand database management tools or traditional data processing applications’. My assumption about individual data was correct…but that’s not even the half of it. Big data is not just closed data owned by business and governments, it is the information that is openly buzzed across social media networks – status updates, tweets, Instagram shares of ‘that’ salad you made last Sunday. It’s the data of the number of mobile phone users worldwide, populations of countries, number of people killed by vending machines each year… it exists everywhere. Big data is omnipresent.

If big data is everywhere, why haven’t we cracked it before now? Tied into the IBM quote above, I assumed a number of reasons. One – the internet is now tracked and analysed more than ever before. Cookies, tracking tags, and various other types of data gathering are taking place all the time. Even as you’re reading this. That wasn’t the case a few years ago. Two – given the IBM quote above, every single business has mountains of data to chew through. That also means large businesses with enormous amounts of data, require many analysts and IT staff to tackle it. That wasn’t the case a few years ago. You could forgive SMEs for thinking that big data was only for the big boys.

One thing is for sure. Everyone is talking about, and searching for big data. The Google Trends graph below shows the rise in searches of the term ‘big data’ since 2004:

When it comes to digital marketing we’ve been using data to prove the success of SEO, PPC and Social Media campaigns for as long as I can remember. Over the last couple of years that has evolved to identifying all the data touch points in the customer journey, and providing actionable insights based on that data.

But there’s a problem. It’s to do with the data. And it’s big. Back in April 2013, Gartner released survey results from a study that showed marketers, on average, allocate 21% of their marketing budgets to marketing analytics. When we asked what percent of the marketing analytics budget was allocated to digital marketing analytics, 24% said less than 10% while 17% said over 40%.

Basic marketing analytics is only step one. According to an October 2012 survey conducted by Econsultancy and Adobe, only 26% of companies worldwide used advanced forms of marketing attribution, with 46% of companies not using any model whatsoever.

Even with an analytics and/or attribution model in place, many brands struggle to make the data actionable.

Taking a step back even further, many brands are committing to their digital future by heavily investing huge budgets into new, all-singing, all-dancing, high performance websites and online collateral, but it seems very few have succeeded in taking the data these websites provide and turning it into actionable intelligence.

Whilst big data is the big buzzword, it seems the digital marketing industry – especially in-house digital teams – are struggling to cope with the data buzzing around their own company, let alone open data from other sources. But let’s not taint every brand with the same brush. Some are handling the data exceptionally well.

Back in May, I attended a Social Media conference and listened to a presentation from Matt Taylor, the Head of Social Insight at Telephonica-owned O2. He and his team use data collected across Social Media, and successfully intertwine that data with customer satisfaction information, data on how many O2 customers redeem a voucher, as well as current customer information. So much so in fact, that he can state – matter of factly – that the best time for O2 to post a piece of content is at 5:14pm.

That’s exactly what data can do, and only one tiny example of why it’s important.

Data helps brands understand their customers. It can show the story behind seasonal trends or help businesses make sense their market. In digital marketing, data allows people to both query and use it for more targeted, personalised online campaigns. The possibilities are almost endless now – we can reach a specific audience at the right time, in the right location, on the right device. This is where understanding data is crucial, with good analytical analysis and technology becoming an essential part of a digital marketer’s toolkit.

Social networks have fuelled a huge, rapid growth in rich, unstructured data that many brands are still struggling to make sense of. Overcome that hurdle, and big data presents a great opportunity for brands to unlock valuable insights. However, without the correct tools and analysis, more data simply adds to the noise, making big data even more confusing.

What’s the solution?

Any digital marketing campaign should have a KPI framework that is agreed by the agency, and the brand. All metrics around customer acquisition – visits (by channel), conversions (by channel), conversion rate, revenue, and ROI to name but a few.

Depending on the business you many also want to measure increased revenue per customer, customer satisfaction, brand presence, market share and positioning.

Once you’ve managed to collect and make sense of that data, you can then add in non-marketing data – user purchase histories, the supply chain, finance, sales and customer service data sets – for a more comprehensive view of customer behaviour.

The brands that use big data well are those that share data openly. Many businesses have created a data hub to allow different users and departments to access the data.

All in all, big data is only going to get bigger. It’s imperative for marketers to understand digital marketing metrics, followed closely by big data, in order to stay successful in the ever-shifting digital landscape.

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