Not all big data is created equal, warns marketing scientist

Marketing scientist from Ehrenberg-Bass Institute warns marketers to better understand where data is coming from in the new frontier of analytics

The new frontier of data is full of possibilities, but marketers need to be aware that not all data is created equal, a leading marketing scientist warns.

Associate professor and director of the not-for-profit Ehrenberg-Bass Institute, Dr Rachel Kennedy, told attendees at the Data Strategy Symposium in the Hunter Valley that the scale and range of data sets available to marketers to understand customer behaviour is “awesome”, but that it can’t simply be taken as face value.

The institute, which is based out of the University of South Australia, researches marketing as a discipline as well as brand and buyer behaviour. Kennedy’s recent examples of work included studies on the accuracy and value of biometrics, neuroscience and virtual shopping.

“People used to think the world was flat until they saw enough data points to know that actually it is round. We’re at that point in marketing where there is a completely new way of thinking about it,” she said.

“We have an enormous capacity to store information that we didn’t in the past, and new ways of searching it that didn’t exist before. It is an exciting world, but it’s very easy to drown in this data. You can have years stored, but still not get the knowledge out of that data. I see a lot of that around the world – people are looking at the magician’s hands and not seeing the big picture because they don’t know what to look for.

“Even the best data doesn’t lead to the right decisions if you don’t know how to look at it.”

Just because it’s big data, it doesn’t mean it’s not biased information or makes you focus on things that aren’t as important to look at, Kennedy said.

Big data analytics: The new black magic of marketing?
Using big data analytics to power customer lifetime value
Big data proves key obstacle for marketers

As an example, she pointed out that ‘likes’ on a Facebook site can offer a skewed sample of consumers to brands because they consist of individuals that are largely heavy users of a brand. The way to grow your market is in fact to target those light to moderate buyers or users who are not present in that group.

“All brands have most of their customer group as light buyers, another group that are moderate, and the smallest percentage are heavy buyers,” she explained. “The route to growth is not the heavy users, because you can’t lift them that much higher and there are not very many of them. You want to budge light and moderate buyers, and that will lead you to do different things.”

In addition, new studies using virtual shopping experiences to try and determine how consumers behave in a physical supermarket environment don’t necessarily reflect how individual shops in real life.

Kennedy pointed out global market research shows the most common number of items purchased by consumers going into supermarkets worldwide is one, meaning many don’t even use a basket or trolley.

Yet virtual reality experiences give consumers the time and opportunity to browse with a trolley, distorting sample information, she said. “This means you’re missing the most popular choices in-store,” she claimed.

“You need to understand the fundamental patterns in how people buy, and have prior knowledge in the principles of how advertising works, otherwise you’ll see things in your data that are just not there.”

According to Kennedy, key ways to determine whether data sources are trustworthy or not are whether it is repeatable, transparent, and relates or is predictive of in-market behaviours within your area or industry of interest in a way that can be proved.

“If I have two different teams measuring things at the same time, I’d want them to give me the right answer. Seems obvious, but in the this new frontier space it’s not necessarily the case,” she claimed.

“You get much bigger wins by looking at what was the same last year and previous year as this year. What’s the same for big and small brands, and what is the same across data sets in different countries? Where you find sameness, that’s the knowledge that’s useful for the predictions you’re going to make for the future.”

And just because new data sets are exciting, it doesn’t mean it’s time to throw out the old methods. For example, A/B testing is still critical, even though we’re working with much better data, Kennedy said.

“We need to get to the point where we know what data we need, old or new, to make the right decision,” she added.

- CMO was the media partner for the inaugural Data Strategy Symposium, organised by Ashton Media, in the Hunter Valley on 25-27 November.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO Australia conversation on LinkedIn: CMO Australia, or join us on Facebook: https://www.facebook.com/CMOAustralia

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

Is customer segmentation dead?

Ginni Rometty, the CEO of IBM, announced the death of customer segmentation five years ago saying, "The shift is to go from the segment to the individual. She might have been a bit premature for most marketers, but if customer segmentation isn't dead yet, it's definitely on life support.

Richard Taylor

Senior digital strategist, Spinach

How people buy brands

Andrew Ehrenberg was a giant in the field of marketing science. He believed scientific methods could reveal law-like patterns of how people buy. In this post, I summarise one of Ehrenberg’s most important discoveries and its implications on how people buy brands.

Kyle Ross

Strategist, TRP

Is artificial intelligence riddled with bias?

The purpose of Artificial Intelligence (AI) has always been to replace the menial and repetitive tasks we do each day in every sector, so that we can concentrate on doing what we do best. Saving time and money has certainly been a decent outcome as AI infiltrates the business landscape, however, now we are starting to see problems that cause major issues in practice.

Katja Forbes

Founder and chief, sfyte

At the deeper levels of artificial intelligence, computing machines make all kinds of correlations among whatever data is available to th...

Fraction Tech

Is artificial intelligence riddled with bias? - Customer Design - CMO Australia

Read more

https://myiplookup.com/ - find your ip address and location information in our main page. Also there are many ip tools you can use : IP L...

savefrom

iSelect outlines new approach to arrest ineffective marketing as its reports full-year results

Read more

https://myiplookup.com/ - this website will allow you to View Alexa Ranking and graph Check http headers of a website, tool to compare te...

savefrom

The Star's first CMO creates all-new marketing team

Read more

Good tips to follow. Thank you!

Anna Travis

5 things every business can do to drive brand loyalty

Read more

Thank you! That was useful to know.

Belia Adam

Why your best social marketing brand tool could be hiding in plain sight

Read more

Latest Podcast

More podcasts

Sign in