So how big is big data? Really big! Would I be exaggerating if I say the concept of Big Data is akin to that of Big Brother from George Orwell’s 1984? Not at all. Every move of ours which involves use of anything related to technology immediately falls in the preview of Big Data. That also includes the use of maps on your smart phone! Earlier it was only about tracking the shoppers buying patterns with the use of a loyalty card but the game has got much much bigger. And like how! Big Data literally can help you with creating models of trends for the future. The tools used here include various things like customers buying patterns, social media trends, the movies that would be released the time frame we are taking into consideration etc. Big Data can be used and successfully so to personalize marketing campaigns and boost results. This is the trend we are witnessing in online retail today but there is a wider scope before them as well if intelligently used.
For those who have just joined in, to explain big data in layman’s language; Big Data is decoding the information we have with us. It is breaking and understanding the sentence – Information is everywhere but where is the knowledge? I quote from www.sap.com – Big Data is the ocean of information we swim in everyday – vast zetabytes of data flowing from our computers, mobile devices and machine sensors. With the right solutions organizations can divide into all data and gain valuable insights that were previously unimaginable.
A McKinsey study stated that, by using Big Data to the fullest, retailers stood to increase their operating margins by up to 60%. In a recent Wikibon.com article, big data expert Jeff Kelly explained that the retail industry is among the early adopters and innovative users of Big Data.
While researching more on the big data, I came across a white paper by IDC which revealed that the data creation is occurring at a record rate. In 2010, the world generated over 1ZB of data; and by the end of 2014, we shall be generating 7ZB! All of the data that is created and accumulated creates unimaginable opportunities across industries and sectors like – healthcare, security, travel, hospitality and of course – retail! Along with IDC, I strongly believe that organizations that are best able to make real-time business decisions using Big Data will thrive, while those that are unable to embrace and make use of this shift will increasingly find themselves at a competitive disadvantage in the market and unfortunately sooner or later shall face potential failure.
Putting it in Context
To draw an example on how Big Data has helped a retail giant reach out to millions, the story of Walmart fits in perfect. In fact, it is believed that Walmart pioneered the use of Big Data to improve operational efficiency in the retail industry and this was when the concept of Big Data was not even officially introduced. Sam Walton’s retail entity was early to understand that by putting to use the data it had of the customers, they could go ahead and streamline their supply chain thus taking care of inventory problem – overstocking as well as understocking it. The money thus saved and made was passed on to customers in form of discounts.
In the online space, Amazon was the earliest mover which in the mid 2000 began using what it know about it customers’ buying patterns and behavior to recommend similar and related items to customers at the point of check-out.
The use of Big Data in its various avatar can be used across – from planning store layout (video identifiers) to merchandize mix to even narrowing down on the right location. Big Data can bring before you dynamics of the population in a particular area, the number of times they shop in the vicinity, go out for coffee, the newspapers they read etc.
Big Data and the Four ‘V’s’
Just as the four ‘P’s’ (product, promotion, place ad price) define the principles of marketing; Big Data is defined by the effectiveness of four big V’s – Volume, Velocity, Variety and Veracity.
The IBM Big Data Hub Explains these 4 V’s beautifully
I would strongly recommend that if applicable to your business, ensure that you do take in professional help and encash on the data mine you have with you. Remember – Big Data today equals BIG COMPETITIVE ADVANTAGE.